European Communities (Amendment) Bill

HL Deb 20 July 1993 vol 548 cc602-701

3.22 p.m.

The Earl of Onslow

My Lords, before—

Noble Lords

Order! Sit down!

Baroness Chalker of Wallasey

My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the European Communities (Amendment) Bill, has consented to place her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

I beg to move that this Bill be now read a third time.

Moved, That the Bill be now read a third time.— (Baroness Chalker of Wallasey.)

The Earl of Onslow

My Lords, my noble friends on the Front Bench will be extraordinarily surprised to hear that I am attempting to make a helpful suggestion. If the action of the noble Lord, Lord Rees-Mogg, succeeds in the courts and the courts then show where this Bill is defective, the Government, I suspect, have one of two options. They can either leave over the Third Reading of this Bill for a little time and amend it to make sure that the objections of the court, should they so arise, are taken care of; or, alternatively, they can pass this Bill. The Bill can then be shown to be defective; and then they will have (heigh-ho) another year of passing another European Communities Bill through both this House and another place. All I ask my noble friends on the Front Bench, in a spirit of kindliness, of co-operation and of helping them forward with their policies—

Noble Lords

Oh!

The Earl of Onslow

—is: would it not be better to leave the Third Reading stage open, so that in the—it may be likely or unlikely—event that the courts find in favour of the noble Lord, Lord Rees-Mogg, and not in favour of the Government, they have a chance of rectifying the situation rather than going through a whole new Session of the next Parliament with a new Bill?

The Lord Privy Seal (Lord Wakeham)

My Lords, I am sure that my noble friend wishes to be helpful to the House, and I am grateful to him for that. But I also wish to be helpful to the House: my advice to the House is to proceed with the Bill on the Order Paper. I take comfort from the fact that these matters have arisen on previous occasions. Page 52 of the Companion to the Standing Orders is quite clear on this matter: any question of sub judice does not apply to legislation.

On Question, Motion agreed to.

Bill read a third time.

Clause 1 [Treaty on European Union]:

Lord Tebbit moved Amendment No. 1: Page 1, line 11, after ("Titles") insert ("(which other provisions shall not include the following words in paragraph 2 of Article N of Title VII "in accordance with the objectives set out in Articles A and B.")").

The noble Lord said: My Lords, as noble Lords will see, this is a very simple and straightforward amendment, although it requires some reference to the treaty to follow its effect. The amendment would in effect take out the words which are set out on the Order Paper; that is to say, in accordance with the objectives set out in Articles A and B This relates to the section (if I may help noble Lords) in Title VII of the treaty, on page 87, at Article N.2. There noble Lords will see the authority, in essence, for the calling of the 1996 intergovernmental conference for the further revision of the Treaty of Rome.

It is clear that from time to time (indeed, on many occasions) this House and the country at large have been told that it would be best that, instead of further delaying the progress of this treaty through Parliament and instead of further examination, Parliament accepted the treaty; that it should be ratified; and then at a later stage Her Majesty's Government would sort it all out within Europe. We would be then at the top table. I have to tell noble Lords that there is only one table and all 12 members of the Community are seated at it. But that is presumably the table to which my noble friends refer.

The grand theme behind all that is that opinion in Europe is moving in our direction; that the federalists have been defeated; that the centralisers have all gone; that the Treaty of Maastricht marks the high water point of the federalist advance; and that we have won all the arguments. The Prime Minister has observed that he is the greatest Euro-sceptic of them all. Presumably, therefore, it is to the arguments of the Euro-sceptics that he refers when he says that he has won the arguments. Indeed, in the interview which the Prime Minister gave on Sunday with Mr. Jonathan Dimbleby on BBC television that was a constant theme of his remarks concerning the Maastricht Treaty.

Even the Daily Telegraph has caught the habit of sloppy thinking. Today's leader is an example of extremely sloppy thinking. It refers to the fact, as it alleges in its words, that: it is plain that a large majority of the House of Commons favours the treaty". In the next paragraph it says: It is regarded by many, if not most, MPs as a wretched piece of Euro-business which Europe would be better without". How those two statements go together in successive paragraphs I do not know. But the leader argues further in that paragraph that, the national interest is best served by arguing for the future of Europe after signing the treaty, not after rejecting it

In Article N.2 in Title VII, which is the subject of the amendment, noble Lords will see that it is written there that the intergovernmental conference will, examine those provisions of this Treaty for which revision is provided, in accordance with the objectives set out in Articles A and B". What are those objectives? One has to turn to page 7 of the treaty and the common provisions. First, there is the establishment of the Union. It: marks a new stage in the process of creating an ever closer union". Article B goes on to refer to the ambition of the Union, to assert its identity on the international scene, in particular through the implementation of a common foreign and security policy including the eventual framing of a common defence policy, which might in time lead to a common defence".

The article refers also to, the strengthening of economic and social cohesion … through the establishment of economic and monetary union, ultimately including a single currency in accordance with the provisions of this Treaty". That is the agenda which is now set in the treaty for the 1996 conference - the conference at which the federalists, the centralisers, will be put to flight. But it will not be with this agenda, because with this agenda by that provision Her Majesty's Government are committed to taking forward these objectives in 1996 and not pulling back from them.

The provision also makes a little more clear why my noble friend Lord Caithness found such difficulty in telling us whether or not the Government believe that a single currency would be in the interests of the other 11 member states. The other day we were told that it was a matter on which Her Majesty's Government have no opinion. That seems strange when we realise that Her Majesty's Government have signed up to Articles A and B of the treaty. It becomes even stranger when we see that they are committed at the 1996 conference further to advance the cause of economic and monetary union. I hope that there is some explanation of that which I have missed.

I hope that it will be explained to us very clearly that the 1996 conference will not have its agenda set by those words and that we should ignore them. I hope that it will be explained that Her Majesty's Government can ignore them and that it will be open to the Government at the 1996 conference to seek to reverse the direction taken by this treaty, to move away from economic and monetary union and to move away also from the proposal eventually to reach a common defence policy.

It would be much easier for the Government if they were to accept this amendment and were not to find their hands bound by the provisions of Title VII. I beg to move.

3.30 p.m.

Lord Stoddart of Swindon

My Lords, we have previously discussed this matter and I am not at all sure that the noble Baroness gave satisfactory answers to the questions that we raised. We want to ensure that the view on the Continent does not prevail. The noble Baroness and indeed the Government, as the noble Lord, Lord Tebbit, has outlined, believe that their view of future developments within the Community will prevail. I am sure that they know that there are others equally determined that it shall be their own view of the Community that prevails.

No doubt the noble Baroness has seen the report by Boris Johnson, EC correspondent in Strasbourg of the Daily Telegraph, on the views of Mr. Willy Claes, the Belgian Foreign Minister. Perhaps I may quote just one or two sentences. The report says: Taking British and German ratification of Maastricht for granted, M. Willy Claes, Foreign Minister, said that the treaty was 'not an end point, but a point of departure'". Another part of the report, which appeared on 15th July, states: Britain would not long escape the Brussels programme for a border-free EC". I did not believe that that was the Government's policy, particularly in relation to immigration and customs. The article goes on: M. Claes called for even tighter Brussels laws. There should be 'an increasingly central role for environmental directives; a gradual strengthening of environmental standards' he said". Finally, the article states: M. Claes stressed Belgium's view of the EC as an essentially centralised, Brussels-based structure. 'The commission is and remains the driving force of European construction', he added". That is an entirely different view from the one expressed by Her Majesty's Government. I believe Her Majesty's Government when they say that that is not their view of the Community of the future and that their view is against a federal structure. I should want to be sure that Her Majesty's Government were being assisted by Parliament, as I feel sure that they wish to be assisted by Parliament, in resisting the views put forward by Mr. Claes and others in the European Community. That is why this amendment has been moved. That is why it is an extremely helpful amendment, which I hope the Government can accept.

The Earl of Onslow

My Lords, it seems to me odd that the Government are so divorced from the feelings of ordinary people in this country. I know that a slightly old fashioned thing called an Earl talking about ordinary people may sound anachronistic. But numbers of people have approached or written to me since the vote last Wednesday saying how they felt they were being deprived of their say. They did not want further political or monetary union; they valued their country; they valued their independence. If my noble friends on the Front Bench go on like this, the Government will eventually lose office. There is going to be an uprising—not an armed uprising, but people will say, "Up with this we will not put. We have been let down by the governing class on both Front Benches." Unless an amendment such as the one proposed by my noble friend Lord Tebbit is accepted, that is what is going to happen.

I say that only because since last Wednesday not one single person has said to me, "You are a wally for voting for a referendum." They said that the House of Lords was a wally for rejecting it.

Lord Ezra

My Lords, the noble Lord, Lord Tebbit, in moving this amendment and to demonstrate the centralising nature of the treaty, quoted from Article A. Among other things, he read out the words of the second sentence of Article A: This Treaty marks a new stage in the process of creating an ever closer union among the peoples of Europe". He needed to complete that sentence. The rest of it reads: in which decisions are taken as closely as possible to the citizen". It seems to me that far from suggesting something of a centralising nature, the whole purport of the article is to suggest something totally decentralised; namely, that decisions should be taken as near as possible to the citizen. That happens to be a sentiment with which we on these Benches wholeheartedly agree. We can think of no reason why we should recommend to the Government that the article should be omitted.

Lord Beloff

My Lords, the right honourable gentleman the Home Secretary is reported in the press today as having said during the campaign in the Christchurch by-election that the Liberal Democrats are best described as the "boot-lickers of Brussels". That is strong language. I wonder sometimes whether the right honourable gentleman has similar thoughts about some of his colleagues in the Cabinet, who continually assure us, in speeches of the kind quoted by the noble Lord, Lord Stoddart, and against all the evidence in the treaty, that it is the firm intention of our so-called partners on the Continent to proceed willy-nilly with a further intensification of integration.

Amendment No. 17, which is grouped with Amendment No. 1, again suggests parliamentary procedures by which the Government could, if they chose, be fortified by the opinions of this Parliament into resisting that process. Therefore, if they are genuine in their belief—if the Prime Minister is genuine in his belief—that what can be done is to stop the process of integration at this point, then they should be happy to accept both amendments.

3.45 p.m.

Lord Clinton-Davis

My Lords, I shall not detain the House for long. There is a certain weariness about some of these debates and also a good deal of repetition. It is not for me to deal with the motivations of the Government or the inadequacies of consideration of certain of the provisions. Suffice it to say that we believe that the 1996 revision conference should take place along the lines set out in the treaty.

With regard to Amendment No. 17, to which little reference was made, there seems to be some inconsistency of approach on the part of those who tabled it. They speak in paragraph (2) of Her Majesty's Government making, such submissions to the Council as either House of Parliament may by Resolution direct". Yet in earlier amendments they talk of "each House of Parliament" and "both Houses of Parliament" and then go back in other amendments to "either House of Parliament". There seems to be a good deal of confusion of thought on the part of those who tabled the amendments. I suggest that they clarify the position with the least possible delay.

In response to the noble Earl, Lord Onslow, I do not mind how the Government lose office—the sooner the better as far as I am concerned. But I am not sure that they will be assisted too much by the noble Earl. I agree also with what was said by the noble Lord, Lord Ezra. When noble Lords quote provisions in the treaty it is as well that they go on to quote the entirety.

The second paragraph in Article A invokes with great deliberation the concept of subsidiarity. It is a concept in respect of which I and my noble friends take a different view from the Government. We believe that it should be applied in this country as well. The fact is that it is specifically stated that decisions are to be taken, as closely as possible to the citizen". That is a substantial improvement on anything that has taken place in the past. We advise the rejection of the amendment.

Baroness Chalker of Wallasey

My Lords, I am grateful to my noble friend Lord Tebbit for moving Amendment No. 1 fairly speedily. But let me take a little time to make absolutely clear what the amendment would do and why I advise the House to resist it.

My noble friend quoted from parts of Articles A and B. As the noble Lord, Lord Ezra, said, he did not quote completely. After his quotation of Articles A and B he said that that would be the agenda for 1996. I want to make something quite clear. The treaty specifically mentions those areas which will be reviewed—policies and forms of co-operation in the treaty; Article 3(1) on the possible treaty chapters on energy, civil protection and tourism; Article 189b on the legislative powers of the European Parliament; Article J.4(6) on defence; Article J.10 on the common foreign and security policy; and the hierarchy of Community points.

That is the agenda which my right honourable friend the Prime Minister brought back following the discussions of heads of government at Maastricht. It is what we agreed should be incorporated in the Maastricht Treaty. Obviously member states will be able to consider other issues if the Maastricht Treaty, by the enactment of the Bill, is agreed. It is also clear that if things have moved on, member states may decide not to follow up a specific review of the items mentioned or they may decide that there are items which are important enough to be reviewed by 1996 and which your Lordships and another place may not have discussed during our many hours of debate.

Article N, to which my noble friend is so attached, and the references to Articles A and B in it, in no way prejudice the outcome of future discussions. There could not be a prejudice of future discussions because it will be the heads of government who decide what comes on to the agenda for any future inter-governmental conference. But it seemed sensible at the time of Maastricht, and that was what we were told on the Prime Minister's return, that those items should be reviewed when it comes to a further IGC.

My noble friend Lord Tebbit referred also to the objective of EMU in Article B. But that objective does no more than match the EMU provisions of the treaty itself, which includes the United Kingdom's right to decide whether and when to move to stage 3 of EMU. The point is that the common provisions, of which Articles A and B in Title I are part, set in their context the operational provisions which follow la ter in the treaty, as with the objective of EMU.

My noble friend failed not only to quote the whole of the sentence from Article A but also that part of Article B which notes that the objectives of the Union shall be achieved as provided in this treaty. That, of course, includes the United Kingdom's opt-out. The provisions of the treaty are not federalist. Were they federalist I would not be standing here answering my noble friend in the way that I have just done.

Article N, which refers to both the Community treaties and the inter-governmental pillars, we have discussed a number of times before. It reproduces Article 236 of the Treaty of Rome, which outlines procedures for treaty amendment. That is why I find it difficult to understand the objection to Article N. We know that any amendments to the treaty arising from any IGC must be ratified by all member states in accordance with the respective constitutional requirements. In the United Kingdom that would certainly mean an Act of Parliament.

I do not believe that there is any more to be said in relation to Amendment No. 1. The noble Lord, Lord Clinton-Davis, said almost all that could be said, although I disagree with him on one or two points. I can assure my noble friend and the noble Lord, Lord Beloff, who spoke to Amendment No. 17, that Parliament's right to scrutinise and influence legislation, and indeed our future dealings in the Community, are not in doubt. The length of time which your Lordships and those in another place have spent on the passage of the European Communities (Amendment) Bill is a good illustration of that—more than 300 hours debating every aspect of the Bill. And as the noble Lord, Lord Richard, pointed out in an earlier debate, another place decided to alter the Bill. However, it seems to me wholly right and sensible that when we have a review clause such as Article N, which is purely neutral and which in no way prejudges the outcome, we should accept it. That is what your Lordships have agreed at previous stages.

It is certainly right that we review the treaty and how it is working in practice, just as we review our domestic law from time to time and make alterations in it. First of all, one has to see how the treaty is working in practice. By 1996 we should have some idea not only of how it is working in practice but what, as we hope will be the case by then, the joining of the EFTA countries in the Community will indicate we should do to make the Community work all the better in the interests of Europe's citizens and British citizens. I sincerely hope that my noble friends will not press their amendments.

Lord Jay

My Lords, before the noble Baroness sits down, will she answer this question? She says that it is reasonable and sensible to make provision for revisions of the treaty. There are certain parts of the treaty which are declared to be irrevocable or irreversible. Shall we have the power to review what is irreversible and irrevocable?

Baroness Chalker of Wallasey

My Lords, if any part of any treaty is found not to be working then those who have combined together to make that treaty can equally combine together to make other judgments and other decisions. That is not to say that it will be easy to decide on what then follows. But if something is plainly not working I do not think that even a Belgian Minister, such as the Minister quoted by the noble Lord, Lord Stoddart of Swindon—a Belgian Minister with whom I do not agree in what he said—would be able to say that it was sensible to leave it as it was. That is the point of review.

Lord Jay

My Lords, we have never before signed a treaty which declared that parts of it were irrevocable or irreversible. Is that really consistent with saying that those specific parts of the treaty can then be revised or reviewed?

Baroness Chalker of Wallasey

My Lords, I shall try again to explain to the noble Lord, Lord Jay. It is my experience of working in various Councils of Ministers and my experience of working with others within the European Community from other member governments that if something is plainly not working it is both sensible and right to change it. If that means that one has to reform part of a treaty by a subsequent treaty—after all, we have indeed changed the Treaty of Rome by subsequent treaties—we will go ahead and do it. But I do not believe that this question of setting a treaty as a tablet of stone for ever and a day is something that either I would go along with or indeed is ultimately necessary.

Lord Bruce of Donington

My Lords, before the noble Baroness sits down, can she confirm that the degree of flexibility to which she referred means that the fifth indent to Article B need not necessarily apply? She will recall that under the fifth indent we undertake to maintain the full acquis communautaire. Are we to understand from what she said that there is a right to disturb what has happened in the past? Is she aware that so far it has been said by Ministers of the Crown that the only way in which past decisions and past regulations can be changed—and there are thousands of them—is on a proposal from the Commission? Is she further aware that her right honourable friend Mr. Peter Lilley himself, in giving evidence to the Select Committee on European Affairs, indicated that there were occasions when the Council of Ministers wanted to change something unanimously and the Commission declined to do so? Are we to understand that that veto has been abandoned now and that the Council can change what has happened in the past?

Baroness Chalker of Wallasey

My Lords, we have discussed the whole question of the acquis communautaire on past occasions and I do not intend to go all the way through it unless many of your Lordships so demand. The short, clear and unequivocal answer to the noble Lords, Lord Bruce of Donington and Lord Jay, is that if all 12 agree that the acquis can be amended, then it will be amended. And that is that.

Lord Tebbit

My Lords, I thank my noble friend for her reply, which I found most interesting. In the interests of brevity I shall refrain from reading the whole of Articles A and B. I find it a little annoying to be chastised for not reading the whole of the articles in making the point when I directed your Lordships' attention to the articles. I was puzzled by some of what the noble Lord, Lord Ezra, said. I do not see that it will bring government closer to the citizens of Europe to establish a single central bank. Would the new central bank be closer to the citizens of Germany than the Bundesbank is today? I doubt it. Would a single foreign policy be closer to the citizens of Greece than one which is fashioned in Athens, or closer to the citizens of this kingdom than one that is fashioned here in this Parliament? I doubt it.

I took some comfort from what my noble friend said in her reply. I noticed that she hoped that the arrival of the EFTA countries will result in substantial change of view within the Community. I think that she may have neglected the fact that each of them will sign up to the Treaty of Rome, as amended by the Single European Act and by this Treaty on European Union. It would seem strange indeed if no sooner than they had arrived, having signed up to the treaty, they were to join Her Majesty's Government in trying to reverse the progress which they had accepted in their signature to the treaty.

I did not ask any questions about the United Kingdom's opt-out provision or the protocol concerning the single currency. I find so frequently that the questions I do not ask are answered and in the process the ones which I do ask are left hanging in the air. I suggested once again that this was an opportunity for a Minister to say whether indeed it was the Government's policy that there should be economic and monetary union. I asked whether it was Her Majesty's Government's policy that they were in favour of monetary union between the other 11 . Again that question was left unanswered. I have been told that Her Majesty's Government have no opinion on this matter and yet it seems to me that they are taking up a position not merely through the signature on this treaty, not merely through its proposed ratification, but in going along with Article N.2 of Title VII.

My noble friend suggested that I was objecting to the whole of Article N of Title VII. That is not so. The amendment is directed to half a sentence of one sub-paragraph. That was the point which I was putting. Nonetheless, I am grateful to hear from my noble friend that in the world of diplomacy and the ratification of treaties the word "irrevocable" means "for the time being we shall go along with it". That is a new definition of "irrevocable" in my understanding of it, but I am grateful to my noble friend.

Finally, having heard her reply, as always I am immensely comforted. I am immensely comforted in the way that a child is comforted when his or her governess says, "Never mind, dear, there is nothing to worry about. Just take this little tablet and drink up your Horlicks. Pull the blankets over your head and all will be well". That is the message which we have received as regards every amendment which has been moved in all the debates that we have had. The message has been "Do not be afraid, children, because nothing is going to happen to you. Nothing is prejudiced for the future. 'Irrevocable' does not mean 'irrevocable'; 'citizenship' does not mean 'citizenship'; 'monetary union' does not mean 'monetary union'. The article here which commits the agenda of the 1996 conference does not commit the agenda of the 1996 conference". I am enormously comforted, but I have a feeling that that sense of warmth and comfort may wear off before very long.

Baroness Trumpington

My Lords, is my noble friend going to withdraw the amendment or not?

Lord Tebbit

My Lords, with the leave of the House, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

4 p.m.

Lord Pearson of Rannoch moved Amendment No. 2: Page 1, line 11, after ("Titles") insert ("(which other provisions shall not include Titles V or VI of the said Treaty)").

The noble Lord said: My Lords, this amendment would improve the drafting of Clause 1 of the Bill by putting on the face of it the fact that Titles V and VI are totally excluded from the Bill. Its purpose is simply to get complete clarification from the Government about the meaning of the words in Clause 1 of the Bill.

On 12th July, in answer to a question from me, my noble friend sought to explain the meaning of Clause 1 of the Bill and a particular phrase therein which reads: together with the other provisions of the Treaty so far as they relate to those titles". My noble friend said: The 'other provisions' to which the Bill refers in this context are the preamble, the common provisions (Title I) and the final provisions (Title VII)".—[Official Report, 12/7/93; cols. 43–45.] The trouble is that her statement did not go all the way. She said what is in the phrase, but she did not confirm what is not in it. I agree that my noble friend did imply that the other provisions do not include Titles V and VI, but she did not actually use words which said so expressly. I hope that it will not be difficult for her to pronounce words which will make the point clear.

Her implication that Titles V and VI are not in the meaning of the phrase in Clause 1 was pretty strong. She implied that including them would run counter to the whole thrust of the Government's thinking about the structure of the treaty and counter to the structure of the Bill. Indeed, Ministers in another place seem to have gone some way to make it clear that the inclusion of Titles V and VI would be contrary to Government thinking. Noble Lords may refer, for example, to what my right honourable friend Mr. Kenneth Clarke said on 27th January (Official Report, Commons, cols. 1108 and 1112) and also what my right honourable friend Mr. Douglas Hurd said on 30th March (cols. 172 and 173).

Implication is not the same as an express statement; neither is it the same as clarity in the Bill. Therefore, I ask my noble friend whether she can accept this amendment for the sake of clarifying the Bill. However, I suspect that she wishes to refuse it. In those circumstances, I ask her now to make a clear statement saying that the other provisions in Clause 1 of the Bill do not include Titles V or VI of the treaty. I beg to move.

Baroness Chalker of Wallasey

My Lords, I am a little mystified that my noble friend Lord Pearson of Rannoch should have tabled Amendment No. 2 because it would not add further meaning to the Bill were your Lordships to accept it. I ask my noble friend to read the whole of col. 44 and the first half of col. 45 of the Official Report for 12th July. There he will see very similar words to those which I am about to use in order to try to clarify for the second time the points that he has raised.

None of the provisions of Titles V or VI—the inter-governmental pillars covering the common foreign and security policy and justice and home affairs matters—relate to the Community pillars. The effect of the existing text is exactly that; so specifying that the other provisions do not include Titles V and VI is unnecessary. It is purely a matter of legislative drafting. I do not find that the Bill would be improved by this amendment. I hope that my noble friend might look again at what I said in the rest cif the paragraph from which he began to quote in col. 44 as regards the other provisions. After I had declared what the other provisions were—that is, the preamble, the common provisions and the final provisions—I went on to explain why those provisions were not being incorporated into UK law lock, stock and barrel.

I went on to explain the difference between the Community treaties covered by Titles II, III and IV and the two inter-governmental pillars covered by Titles V and VI. In col. 45 he will see that I referred to a similar technique used successfully in the European Communities (Amendment) Act 1986 which gave effect to the Single European Act. It contained not just EC matters but the inter-governmental provisions. We hoped to keep this matter as simple as possible and to follow the same pattern of the division between the Community treaties and the inter-;governmental pillars. That is exactly what the existing text of the Bill does. That is why I urge your Lordships to resist Amendment No. 2.

Lord Pearson of Rannoch

My Lords, I am most grateful to my noble friend. I apologise to your Lordships' House if I have been obtuse about her earlier explanation. I believe that she has made the matter as clear as she is going to on this occasion. Therefore, I have pleasure in withdrawing the amendment.

Amendment, by leave, withdrawn.

Lord Bruce of Donington moved Amendment No. 3 Page 1, line 24, after ("unless") insert ("the principle that the United Kingdom move to the third stage has first been approved in a consultative referendum and unless").

The noble Lord said: My Lords, in essence this amendment refers to the occasion when Her Majesty's Government have to decide whether or not to opt out from the full economic and monetary union provisions of the treaty. Quite clearly, the fact that there is an opt-out at all means that the Government are in some doubt as to the principle which is involved despite the fact that they subscribed to Article B of the treaty where the objective of EMU is set out.

Fortunately, my own party is in no doubt whatsoever and has placed itself firmly at the head of the movement towards economic and monetary union. Perhaps your Lordships will bear with me for a moment while I find a quotation from Committee stage which deserves to be emphasised. Speaking on behalf of the Labour Party, my noble friend Lord Eatwell said: I suggest that monetary union would create a framework in which real convergence was easier to attain and, indeed, the absence of it would make real convergence and sustained growth in Europe extremely difficult to attain … The second advantage of a monetary union is that monetary policy would be determined on a European basis, not simply in the interests of one particular region of Europe… The third advantage of a monetary union is that a co-ordinated fiscal policy in Europe, a co-ordinated strategy which has been called for at the Copenhagen Summit, would be possible, and is only possible, effectively within a monetary union".—[Official Report, 23/6/93; cols. 363–4.] That is emphatic enough. There is not a scintilla of doubt about where Her Majesty's Opposition stand on the matter. There are not even any particular reservations about the concomitants to the establishment of this desirable state of affairs—that is to say, the establishment of an independent central bank responsible to nobody at all for the determination of key items of policy and, of course, the overall position whereby the Brussels bureaucracy itself has additional powers which it will exercise irrespective of what the member states may think about it. So the Opposition's position on this matter is settled.

I appeal to the Government, who are the other junior partners in this. Are they going to join the Opposition's drive to a federal Europe, to the establishment of a unitary state, which the establishment of economic and monetary union and a single currency automatically brings, or are they going to be left on the slow-speed train following Her Majesty's Opposition in this matter? It is extremely important that we should be told.

As the noble Lord, Lord Tebbit, has said, that question was addressed to the noble Earl, Lord Caithness, in the course of our previous proceedings, but he declined to commit the Government on the questions of principle as to whether they really believed in economic and monetary union and whether it was a good thing. The noble Earl referred continuously to the Government's opt-out and was not prepared to commit himself further. He would not address himself to the merits of the judgment on the principle of whether this country ought to enter economic and monetary union and ought to have a single currency. He would rather leave it to the opt-out stage to see whether at the particular stage envisaged it would be satisfactory for the United Kingdom to do so.

We have already had discussions in your Lordships' House concerning a referendum on the Bill as a whole. That question was decisively decided by a vote of very unusual proportions in which, if I may say so, hundreds of my colleagues previously unknown to me and never sighted by me in this place suddenly became attracted to our proceedings and were so absorbed by the quality of government oratory that they decided to descend on this place, to listen to the arguments and then to vote. They are not here today and they may not appear for another five years or so, although as long as they have the Writ of Summons they will naturally be extremely well received here and will, I have no doubt, receive an enthusiastic welcome by the Refreshment Department when they next decide to arrive.

In the meantime, surely this is a case on which the general populace can help the Government to make up their minds. My party is not involved in this. It has already made up its mind and is firmly set on the train to a federal Europe, with one or two marginal considerations which it does not consider to be of any great importance. It is Her Majesty's Government with whom I am principally concerned today. I feel that they ought to take advantage of the opportunity of a referendum on a very limited scale purely to help them to make up their minds as to whether they should opt-out. It should not be difficult to frame the question for a referendum in this case and it would help to lift the Government out of their paralysing indecision on the question of whether EMU is a good thing. I hope that, in the interests of their own peace of mind as well as that of their followers, the Government will accept the amendment. I cannot, of course, envisage for one moment my own party having anything to do with it. It is already dead certain.

Lord Bonham-Carter

My Lords, before the noble Lord sits down, would he agree that a substantial number of the Members of your Lordships' House who voted on that question and whom he had never seen before voted on his side?

Lord Bruce of Donington

My Lords, yes, I cannot possibly dissent. A very large number of them might, in fact, have attended the debate.

4.15 p.m.

Lord Hamilton of Dalzell

My Lords, in supporting the noble Lord, Lord Bruce of Donington, I am brought to mind of the very distinguished speech of my noble friend Lord Lawson of Blaby during the referendum debate in which, from his great position of authority, he stated that the moment when we join a single currency is the moment when we finally lose control over our own financial affairs. Therefore, I would certainly support him in his view that that is the moment when we should have a referendum and I feel that it would well behove the Government to insert such a provision in the Bill now.

I should like to speak also to Amendment No. 6 which seeks to insert a new clause in the Bill that reinforces the Government's position which, as I understand it, is that they consider themselves to be under no obligation to rejoin the ERM—

The Minister of State, Department of Transport (The Earl of Caithness)

My Lords, I am grateful to my noble friend for giving way. As I understand it, Amendment No. 6 is not grouped with Amendment No. 3. It will be taken separately in a few minutes' time.

Lord Hamilton of Dalzell

My Lords, I apologise to your Lordships. I shall speak to Amendment No. 6 later.

Lord Stoddart of Swindon

My Lords, I rise to speak briefly. I sincerely hope that the Government will support the amendment, which seems to me to be very helpful. It gets the Government off the hook. It puts them back on the side of the people because, as the noble Earl well knows, it has been shown in public opinion poll after public opinion poll that people want a referendum on who is to govern this country. If the Government were to give the assurance at this stage that there would be a referendum before we went into a single currency (and with it a political union), the people of this country would be given the opportunity to have their say and a lot of people who are very dissatisfied at present might feel a little better about it. Those who sincerely believe that we are on our way to a Federal European union may very well be reassured if the Government were at this stage to write into the Bill a provision for a referendum before we entered a single currency.

I should like to follow the noble Lord, Lord Hamilton, in praising once again the noble Lord, Lord Lawson, whom I followed on 14th July, on his maiden speech. His words are worth quoting so that they are rewritten into the record. He said: However, should there come a time when this or any future British Government are so unwise as to conclude that this country should participate in a European monetary union, with all its political consequences, that would be a decision of such momentous constitutional significance as to warrant not merely the separate approval of Parliament at a time as provided for in the treaty before us, but also a prior referendum of the British people".—[Official Report, 14/7/93; col. 257.] Those are powerful words from a senior politician which should be heeded by Her Majesty's Government. As I say, if those words were written into the Bill it would give a great deal of reassurance to those people who are genuinely worried about this country's future as a fully independent, self-governing state. I hope that the noble Earl will at least be able to accept this amendment, although the Government have so far refused rigidly to accept any reasonable amendment, even a technical amendment.

Lord Peston

My Lords, I thank my noble friend Lord Bruce for introducing this matter and in particular for stating so clearly the policy of the party of which he is a member, which I thought my noble friend Lord Eatwell put rather better than I could have done. It is the Labour Party view, and it makes the overwhelming case for economic and monetary union. I also thank my noble friend. Lord Bruce for making the point that I had made: that some of us, mainly on our side, know where we stand; some on the other side know where they stand; but those who still provide us with a problem are the Government, who do not seem to have the faintest idea where they stand. Although I have no hope that the noble Earl will be able to tell us where the Government stand on this matter, this at least gives him one more opportunity to do so.

The amendment is about a referendum. It is not about EMU. I assume that it is within the courtesies of the House that I can now speak about the maiden speech of the noble Lord, Lord Lawson, although it is not customary to attack a maiden speaker at the time that he speaks. My noble friends supported it. I found his maiden speech, although terribly interesting, completely bewildering on this matter. If he felt so strongly about EMU, the time to vote for a referendum was last week. If I may use a vulgar expression, it is a cop out to say that he might vote for a referendum if EMU became a reality but was not willing to vote for one last week. I see nothing in the Bill which says that the time to come will be later rather than sooner.

I very much regard EMU as a matter for government and Parliament to decide. That is my judgment and that of my party. When the time comes for EMU—if the Government make up their mind—the correct thing is not a referendum, which would be absurd on such a matter, but for the Government to come to Parliament to say that they have now decided that they wish to proceed with EMU and to look for support within the two Houses. That is the correct way to proceed on such a matter. I believe—I cannot anticipate; I am merely theorising—that were it to happen, as it may well do—sooner rather than later—that the party of which I am a member brought EMU before Parliament, I am sure that we would bring it in a straightforward way and say that that is what we believe in, and, "Vote for us or not".

The Earl of Caithness

My Lords, I listened with care to what the noble Lord, Lord Bruce of Donington, said when he moved the amendment. I visualised him in his first-class carriage on the Labour Party's train on a speedy downward descent into federalism. I hope that the noble Lord will find time to get off the train, stand on the station and wait for a more sensible train in which he would be more comfortable and happier.

I understand the noble Lord's desire to ensure adequate public debate before the United Kingdom makes any commitment to participate in a single currency. It is an objective that the Government share. Our debates on the EMU provisions of the treaty have underlined the importance of those issues. As I have explained before, the Government's approach is based upon three fundamental principles: first, we do not believe that the present Community is ready for a single monetary policy and currency; secondly, we do not believe that we should consider establishing a single monetary policy before a sufficient degree of economic convergence has been achieved; and, thirdly, equally, we do not want to make a decision now which would, once and for all, cut us off from developments with major implications for this country's economic and financial interests. That is why we have been involved fully in the negotiations which led to the Maastricht Treaty; that is why we shall continue to play a full part in Stage 2; that is why we negotiated the UK protocol (our opt-out clause); and that is why my right honourable friend the Prime Minister secured at Maastricht the right of Parliament to decide whether and when we should seek to join a single currency. That was an important negotiating success, as was recognised by this House soon afterward.

I should like to remind the House that the treaty does not specify how Parliament is to be involved in decisions on the move to Stage 3; nor would it be appropriate for me to do so. It was the Government who decided to put into Clause 2 the requirement for a full Act of Parliament before any move to Stage 3. That Act will provide ample opportunity for the Government and Parliament to add further conditions, such as a referendum, to any move to a single currency. It would cut across the basic principle of maximising the freedoms for future governments and Parliaments, which has been the cornerstone of the Government's approach to EMU, if we were to impose unnecessary conditions now.

I listened with care to the noble Lord, Lord Stoddart of Swindon, when he quoted from the speech of my noble friend Lord Lawson of Blaby. I wish that the noble Lord had not stopped quoting when he did. So let me carry on where he stopped. He stopped at the words "the British people". My noble friend Lord Lawson went on to say: Unless and until that time arrives—and for a number of reasons I rather doubt that it ever will—I do not believe that the case for a referendum is made and I shall vote tonight accordingly".—[Official Report, 14/7/93; co1.257.] That coincides with the Government's position. That is the success of the opt-out clause. That is also the success of Clause 2 which allows for a full Act of Parliament in respect of which your Lordships can debate this measure again.

Your Lordships will recall the full debate on referenda that we had last week. We debated a referendum in relation to the Maastricht Treaty. The Government made clear their position on calls for a referendum. In our system of parliamentary democracy, Parliament is elected to represent the people and to take decisions on their behalf. That is how the Maastricht Bill is being considered. Your Lordships' House supported that approach overwhelmingly.

Of course, ratifying the treaty does not oblige the United Kingdom to accept a single currency—a point that I have stressed consistently. I accept that the amendment raises somewhat different issues, but the arguments of principle are similar. There are arguments that I am sure your Lordships would want to consider fully if a Bill were presented by a government proposing a move to Stage 3, but until then I hope that noble Lords will accept the Bill as it stands.

4.30 p.m.

Lord Bruce of Donington

My Lords, I am grateful to the Minister for his reply. I am sorry that he has not seen fit to accept the amendment which, as my noble friend Lord Stoddart said, would in certain eventualities have got the Government off the hook. Be that as it may, the noble Earl has at least confessed that the Government are still tormented by doubt. To be tormented by doubt is often the beginning of wisdom. The Minister and the Government are showing promising signs, and I sincerely hope that they keep that up. In the meantime, I am glad that my noble friend Lord Peston, who is an economist, has seen fit to give his full confirmation to my party's drive towards a federal Europe—

Lord Peston

No.

Lord Bruce of Donington

My Lords, my noble friend will be able to read Hansard tomorrow. Indeed, during the past three or four years my party has not been without the economic advice which considerably enhanced the change of view that took place during that time, including that towards the ERM. Perhaps I may explain my attitude towards the whole issue by reminding the House of the words of another famous economist from Cambridge, Mrs. Joan Robinson. She said: The purpose of studying economics is not to acquire a set of ready-made answers to economic questions but to learn how to avoid being deceived by economists". I have heeded those words, and I hope that in due course my colleagues will see fit to do the same. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Willoughby de Broke moved Amendment No. 4: After Clause 1, insert the following new clause:

Common Agricultural Policy: reform

(".—(1) Before 30th June 1995 Her Majesty's Government shall lay before both Houses of Parliament a Command Paper considering the extent to which reform of the Common Agricultural Policy requires amendment of the Treaties under the provisions of Article N of the Treaty on European Union. (2) Her Majesty's Government shall thereafter make such submissions to the Council as either House of Parliament may by Resolution direct.").

The noble Lord said: My Lords, I am pleased to move this amendment today. It was my intention to do so on Report but I was informed that the wording was out of order. I am therefore forced to table an amendment in terms which some noble Lords believe are not applicable to the Bill before the House.

It transpires that I was in order in putting forward the amendment at an earlier stage because my noble friend Lady Chalker has since confirmed that Title VII, to which this amendment refers, is included in the Bill under those two little words, "other provisions". Therefore, we are no longer talking about having to remove Article 3(e). The amendment before the House deals with the powers of treaty revision in 1996 under Title VII, Article N(2). Treaty revision is of central relevance. The amendment will enable Parliament to give a direction to Her Majesty's Government about that revision in connection with the common agricultural policy.

I shall not rehash the old arguments about the CAP. There has been broad agreement in the House on the need for reform of that policy. However, I part company with the Government on the likely effectiveness of the reforms already in place. By happy chance a House of Commons paper was published on 13th July entitled CAP One Year After Reform. It makes somewhat disappointing reading for those who believe that the new reformed CAP is a real advance on the old unreformed model. It is in the nature of an end-of-term report and the conclusion is that the pupil shows little promise and must work harder to achieve the desired result.

I do not propose to go into detail; I wish simply to summarise the reasons for that rather dampening conclusion. First, set-aside payments have been substantially increased as Danegeld to the French. Secondly, milk quotas have been increased as Danegeld to the Mediterranean countries of Italy, Spain and Portugal with the consequence that milk surpluses must be paid for at a much higher cost of disposal. Thirdly, annual sheep premiums are payable for larger flocks of sheep than was originally envisaged. Fourthly, and perhaps most crucially, there is no provision for limiting the period during which compensation may be paid to farmers.

It is clear that the benefits of the MacSharry reforms are being whittled away by those concessions. I wish to draw your Lordships' attention to the conclusions of that part of the report. It states: All the signs are that when it comes to the point the Council of Ministers continues to modify previous agreements in a way that protects potential losers—always at the cost of higher overall expenditure. Until there is a change in this behaviour, it is difficult to be too confident that spending will he kept under control". That conclusion is borne out by another recently published independent bulletin, produced jointly by the NFU and the TSB. It concentrates more on the looming budgetary crisis in the CAP caused by the weakening of the reform process, about which I have spoken, and the monetary factors—the turbulence, to put it politely, in the ERM during the past nine months and negative economic growth in Europe. The report points out that all those factors will lead almost inevitably to the CAP budget exceeding its guideline. As the Commission cannot legally set a budget which exceeds the guideline, I wish to know what measures it is likely to propose to bring the budget within set limits.

On Report I asked the Government how the United Kingdom, only one of 12 voices, will be able to influence decisions taken on agriculture in the Council of Minsters, especially when a large majority of the other 11 are not only major beneficiaries of the CAP but do not contribute to the EC budget at all. Presumably they will be quite happy to continue to lead a champagne life on beer money. Perhaps my noble friend will agree that the provisions of Article N offer an ideal opportunity for the Government to use their influence as one of the three paymasters to the EC coffers in order to secure some real reform of the CAP in the likely event that such reform will be of interest to them and to the country as a whole.

I do not expect my noble friend to accept the amendment but I hope she will recognise that it is tabled in an attempt to strengthen the Government's hand in future negotiations. I beg to move.

Lord Harris of High Cross

My Lords, it is a pleasure to return to the CAP because there is so much agreement. We know that the Government come to this House and to the other place and affirm their complete commitment to radical reform. We hear from the noble Lord, Lord Willoughby de Broke, that the reform as it unfolds is disappointing.

In order to get away from the sad events of Maastricht I was during the weekend tempted to read through the diaries of Alan Clark. It was a great mistake because I came to the report of a meeting that he had in Luxembourg with some European commissioners. At that time he was at the Department of Trade and Industry. He explained that he had a prepared speech which represented his view of government policy on the matter in hand. Five minutes before he was about to deliver that speech it was snatched from his hands by a powerful lady. He was not as complimentary about her as he sometimes is about ladies whom he meets during his work. He was given a handful of notes and was told that that was the latest line. When he demurred he was told that there had been a telegram or a telephone call from the Foreign Office.

That passage brought me back to this great contention. In our discussions on Report on 12th July, at col. 21 of the Official Report, the noble Baroness, Lady Chalker, recalled as a mitigating factor for the CAP that it was helpful in ensuring sufficient food to feed Europe. As I understand it, she was saying that that was one of its original justifications. Of course, it has been overtaken wholly by events since then, because it is piling up enormous surpluses which we can scarcely afford to maintain; which we have to give away; and which undermine world markets.

My worry is that at the back of the minds of those in the Foreign Office is the notion that there was some justification for it. I have the suspicion that they will go soft on the CAP. They are on our side now, but the question is: will they stay bought? I wanted to make a small contribution to the thinking of the noble Baroness. If my new-found friends on the Labour Benches will kindly avert their ears for a moment, I should like to tell the noble Baroness that the common agricultural policy is typical of many of the socialist policies that we have criticised over the years. They had some justification way back—that is, 40 years ago—but they have been perpetuated long past their time.

A private company plans ahead for five, 10 or 20 years. However, it is very quick to change when circumstances have been totally transformed. Government is very slow to change. It is a piece of socialism which has been overtaken by events. Here we are, passing a great law which will indicate approval for the whole of the business that is going on in Europe. All we are asking is that the Government should display their share of commitment on the common agricultural policy by inserting into the Bill the well-chosen words in the amendment; namely, that by June 1995 they will, lay before both Houses of Parliament a Command Paper [showing] the extent to which reform of the Common Agricultural Policy requires amendment of the Treaties". That seems to me to be something which, in their own hearts, they would wish to do. We would like to invite them to have a nice day and to allow us to insert the above wording.

The Earl of Onslow

My Lords, it seems impossible to over-estimate the importance of reform of the CAP. It is equally impossible to over-estimate the importance that the CAP has on distorting not only European agricultural trade but also the agricultural trade in the rest of the world. As your Lordships know, I am a farmer and I am also a beneficiary of set-aside. We must—and I emphasise the word "must"—do something about it and get it into the heads of our colleagues on the Continent that it is vitally important to do so.

At the same time, we must be equally sensitive to the problems of depopulation as regards French rural villages and poverty in Sicily. We must try to separate the social and environmental problems of the countryside—which, for want of a better word, I shall call "the gardening and gamekeeping problems"—which are of general interest and which should be subsidised by general taxation in some form or another, either Community based or individual country-based, but preferably by a combination of both.

We must remove food production from the position of being subsidised. Funnily enough, there are no villains in the story. We remember Boyd Orr, and we remember U-boats in the Channel. Boyd Orr is long since dead and the U-boats surrendered on 8th May 1945. However, there was fear of food to Western Europe being cut off. That has been solved by generous incentive payments to producers and the agro-chemical and plant revolutions, all of which have done nothing but great good to the world.

We must try to address the problems as they are now rather than what we thought they were 40 years ago. Above all, we must do so before the great grain-growing lands of Galicia and the Ukraine come back into production with the standards that they had before the 1914 war. Noble Lords have heard me banging on about Odessa before: I shall bang on about it, probably, until I die. To me, it is one of the most vivid images of the problems which will face world trade and world agriculture unless we address them now rather than let them tumble down upon our heads.

4.45 p.m.

Lord Simon of Glaisdale

My Lords, the grouped list of amendments with its statement of the subjects of debate has a somewhat familiar appearance. I trust that it will not seem ungrateful as regards debating of a very high order if I say that the proponents of the amendments give something of the appearance of a stage army. Today's debate is the third that we have had on the common agricultural policy. The CAP cannot conceivably be within the scope of the Bill which, as the Long Title says, is to make changes "consequential on … Maastricht". But the common agricultural policy was the creature of the Treaty of Rome, decades before Maastricht. We adhered to it almost 20 years before Maastricht.

We have had very interesting teachers. I do not complain about that at all; indeed, we have learnt much. However, the Procedure Committee is being asked to consider what has happened on the Bill lest it might be a precedent. It might particularly consider the three debates on the common agricultural policy.

Baroness Elles

My Lords, I should like to support the noble and learned Lord, Lord Simon of Glaisdale. All elements concerning the reform of the common agricultural policy are precisely contained in the Maastricht Treaty. If the treaty is kept as it is, there is every possibility and every opportunity for our Government to play a leading role in the reform of the CAP as is required.

We have only to look back over recent years to see that one of the major efforts has been to reduce surpluses. That has been most successful. However, we now read in a report on the state of the world that there will be a massive shortage of food because of an increase in population. That is just one example of why one cannot resolve the problem of the CAP one year and think that it has been resolved forever; it is a changing circumstance. I believe that the Maastricht Treaty covers all the possibilities and that it will allow our Government to play a leading role in the reform. Therefore, I totally reject the amendment.

Lord Gray

My Lords, if the importance that has been attached to the matter by my noble friends needs any reinforcement, it can be found in a report which I read only a few days ago concerning the latest CAP folly. Apparently, the 15 per cent. set-aside for which we pay will increase costs, not save on them, because the increased production which we subsidise has, in effect, only achieved 1 per cent. of the proposed figure of 15 per cent.

Lord Stoddart of Swindon

My Lords, I feel that I really must respond to the remarks made by the noble and learned Lord, Lord Simon of Glaisdale. He accuses those who have been opposing the Bill of being part of a stage army. Well, if that is the case, all I can say is, "Thank God for stage armies." If the situation had been different, the matter would have gone through on the nod. That is something which I and my colleagues are not prepared to allow.

We have before us an important Bill about a very important treaty. The fact that we have had to use our ingenuity to enable us to discuss the matters within the treaty is, perhaps, unfortunate. Nevertheless, it had to be done to ensure that the treaty was given a fair and proper hearing by this House and to enable noble Lords to have the opportunity to do their duty; namely, to scrutinise and, if necessary, to revise legislation.

It is most unfortunate that those of us who have tried to do our duty should have been incessantly criticised for the way that we have had to do so because of the rules of order and because of the way in which the Government have, perhaps, found it necessary to introduce the Bill and have the treaty discussed. I hope we shall hear no more about breaking the conventions of this House. I have seen amendments put down in Committee, at Report stage and at Third Reading and the same arguments were used on each of those three occasions. Why it should be different in the case of this Bill I simply do not know. As far as I am concerned, the people on both sides of the argument who have had the decency, courtesy and indeed courage to take part in this Bill deserve praise rather than the reverse.

Lord Carter

My Lords, this amendment deals with the amendment to the treaty which will be required to reform the common agricultural policy, which I believe concerns Articles 38 to 47. I must congratulate the drafters of the amendment on the ingenious route they have found to get into this debate. For a long time I have been struck by the similarities between the objectives clauses of two different Acts. The first Act is the 1947 Agriculture Act. I paraphrase Section 1 of that Act. The Act had the purpose of promoting and maintaining a stable and efficient agricultural industry capable of producing agricultural produce at minimum prices consistent with proper remuneration and living conditions for farmers and workers in agriculture and an adequate return on capital invested in the industry.

The other objectives clause is Article 39 of the Treaty of Rome which states: The objectives of the common agricultural policy shall be: to increase agricultural productivity … to ensure a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture; to stabilize markets; to assure the availability of supplies; and to ensure that supplies reach consumers at reasonable prices". I have always been struck by the fact that those two objectives clauses are extremely similar. However, Section 1 of the 1947 Agriculture Act is repealed by the Agriculture Bill which is now going through the House.

The articles in the Rome Treaty which set out the objectives of a common policy for agriculture—not the common agricultural policy—are acceptable. The problems with the CAP have arisen due to its bureaucratic complexities, the plethora of regulations and directives and the wheeling and dealing in the Council of Ministers. At least this amendment tabled at Third Reading disposes of the debate we had to have at Report on the distinction between a common policy for agriculture and the common agricultural policy as we presently have it. That is not a connoisseur's distinction; it is central to the argument.

As I said on Report, I believe that a great trading bloc with its responsibilities to GATT and operating a single market must have a common policy for agriculture. But my objection to the amendment is that I am not sure at all that amendment of Articles 38 to 47 of the treaty is required to bring about the fundamental reform of the CAP that we all want to see. That point was picked up by the noble Baroness, Lady Elles. After all, at a recent meeting of the GATT the European Community agreed to limit cereal production, limit cereal exports, limit oilseed production and reduce export subsidies. That was all achieved without the need to amend the treaty. At the other extreme, as we all know, we now have a set-aside policy designed to remove production from millions of hectares of European farmland. That again has been agreed without amending the Treaty on European Union.

The MacSharry reforms introduced what are in effect deficiency payments, although we were told for years that this was not possible under the Treaty of Rome. Again a fundamental change of policy moving from income support to farmers through price support, to income support through direct aid payments has been achieved without amending the articles in the Treaty of Rome. We can go right back to the founding of the Community in the 1950s and the agreement between France and Germany that was referred to by the noble Lord, Lord Tebbit., as a conspiracy between them, in which the Germans accepted the high price of grain to suit the French farmer to enable the Germans to have a market for their industrial exports. In passing, I should say that the biggest mistake in the whole history of the CAP was to set the price of corn too high because the price of corn is central to agriculture policy. If the price of corn is too high, we know the political effect of the price of bread but it also affects the price of animal feedstuffs. But that fundamental agreement on the high price of grain was achieved within the articles of the treaty.

I could give further examples of changes to the CAP. The Mansholt Plan is another example of a fundamental change. The Mansholt agreement. the Franco-German agreement, the MacSharry reforms, the GATT agreement and the set-aside policy are all examples of matters that have been agreed without any changes to the treaty. They all represent fundamental attempts to reform the CAP. For this reason I think it would be possible to produce a much better common policy for agriculture than the present CAP without the need for amending the treaty as this amendment envisages.

Before I sit down I wish to repeat the question I put to the Minister on Report to which she could not reply at that stage. Why in the negotiations at Maastricht, with the opt-out from the social chapter and the opt-out from EMU, did the Government not then attempt in their bargaining to insist on reform of the CAP as a part of their negotiating package? I and a number of other speakers asked that question on Report but the Minister did not reply then. I hope she will do so now.

For all the reasons I have mentioned. I feel that this amendment is unnecessary, although I concede to nobody the wish to reform the CAP root and branch. If this amendment were to be pressed, I would regretfully have to advise my noble friends to vote against it.

Baroness Chalker of Wallasey

My Lords, I feel, rather like the noble Lord, Lord Carter, and certainly the noble and learned Lord, Lord Simon of Glaisdale, that we have been over rather a lot of this ground before. I shall try not to delay your Lordships too long but to seek to answer one or two of the points that have been made about this amendment and in the many speeches which have gone far wide of the amendment.

The details of the common agricultural policy and the efforts to reform it are not part of the EC treaty and can be changed without treaty amendment, as the noble Lord, Lord Carter, has just said. It is the detailed provisions of the common agricultural policy, not the existence of a common policy itself, which have created the problems in Community agriculture. In a few moments I shall say a word or two about CAP reform.

It is indeed, as the noble Lord intimated just now, Article 38 of the Treaty of Rome which states that the common market shall extend to agriculture and agricultural products and that a common agricultural policy is necessary to have fair and free trade in agricultural produce. But we have made progress on CAP reform. The House should be in no doubt that this Government intend to pursue it further with vigour. We intend to build on the reforms which have already been achieved and we can do that without treaty amendment. In any case I hardly think that now is the time to be considering yet more treaty negotiations, were that immediately necessary. Fortunately for us that is not necessary. I believe this is a time when we should seek stability and consolidation as well as reform in the CAP.

To negotiate CAP reform as part of future treaty negotiations I believe would be misconceived and likely to be counterproductive. I would say to the noble Lord, Lord Carter, that we discussed treaty change at Maastricht, but knowing that the CAP did not require treaty change but rather policy change, we did not go further down that agenda. Although I may not have answered his question at Report stage quite so explicitly as that, I hope the noble Lord will now be satisfied with that reply. His nods encourage me to think that I might just have scored at least one small mark with him.

My noble friend Lord Willoughby de Broke in moving this amendment talked about the real problems of agriculture. Let me for a moment talk about some of those real problems. However, I do not wish to detain the House for long. In doing so perhaps I may say to the noble Lord, Lord Harris of High Cross, who has obviously had a thoroughly enjoyable weekend reading Alan Clark's apocryphal stories, that Her Majesty's Government will not go soft on CAP reform. I shall be talking to the Minister of Agriculture about this tomorrow, having been enthused by the noble Lord, Lord Bruce of Donington, to get to grips with some of the detail which hitherto I had not found time to do. I am quite certain that we shall see sound reforms from my right honourable friend Mrs. Shephard. She is a very sound lady.

My noble friend Lord Onslow spoke of the CAP as a distorting factor. The only way to stop the CAP being a distorting factor is to get on with this reform. I want to look forward—as I believe the noble Lord, Lord Carter, does, although he quoted the 1947 Act —and talk for a moment about our further objectives for reform of the CAP.

I have already referred, at Report stage, to the commodities that are not covered by the 1992 agreement. We want farmers to have a reasonable return from the investment of their labour and other resources. We recognise the need for consumers to secure supplies at fair prices. We need to ensure compatibility with the liberalisation of world trade. We need to take account of market and budgetary realities. We need to assist the Community's relationship with its trading partners and with developing countries. We need to keep artificial constraints and distortions to a minimum. We also need in the Community to recognise agriculture's role in protecting and enhancing the environment, because it can so do if it is given the chance.

When my noble friend Lord Willoughby de Broke moved the amendment, and when my noble friend Lord Gray spoke of the cost of set-aside, I felt it incumbent upon me to say to your Lordships that I accept that one consequence of CAP reform will be an increase in the budgetary cost of the CAP, but that will be more than offset by the reduced burden on consumers. Overall, the cost of the CAP to consumers and taxpayers will be lower, and at the time of the reform it was estimated that after the full implementation of the package the savings to EC consumers could be of the order of some £8 billion.

There is a great deal to be done in this field. It is a field which we should perhaps debate on another occasion rather than tonight. I now have many interesting pages on the intricacies of farming, which I am studying with great pleasure. On another occasion perhaps I shall have an opportunity to regale your Lordships with some of the facts.

The noble and learned Lord, Lord Simon of Glaisdale, was right, but I shall not enter into that debate. However, I defend his right to say what he said, as many others might have wished to do.

Of course, as Government we always have the opportunity to seek a mandate from Parliament on a wide range of issues. That is without contention. However, it is frankly not practicable for the government of the day to seek a mandate on any and every thing. The government of the day are there to govern and take decisions in the light of circumstances and to convey the detail of those decisions to Parliament. I simply do not believe that we should enshrine in legislation the sort of measure proposed by my noble friend Lord Willoughby de Broke in Amendment No. 4. We shall keep Parliament well informed, in the normal manner, of our efforts to further CAP reform and of the detail thereof. I am quite certain that in the measures which my right honourable friend the Minister of Agriculture wishes to take even my noble friend Lord Willoughby de Broke will find some comfort in the years ahead. The amendment is not one which would assist us in our work. It would simply take up time. That is why I have spent a little time trying to reply to the points which have been raised.

One of the points raised by my noble friend requires an immediate and detailed answer. He mentioned additional milk quotas. The additional quota for Italy, Spain and Greece has been granted on a provisional basis for this year only. I can inform him that the Council has not committed itself to continuing an additional quota next year. It could do so only if the Commission confirmed that the countries in question were meeting their obligations to implement the quota system properly and cut milk production. What has been agreed is likely to result in a 14 per cent. reduction in the Italian production. Therefore, that move will help reduce the over-production in the EC. That is why the measure has been carried through.

I have considered various other aspects of the points raised by my noble friend, but they should be considered in a proper agricultural debate, particularly as they are not part of the Maastricht Treaty. They do not form part of our Bill. The amendment, although very interesting (and it caused me to do some interesting reading) is not one which, in our deliberations on the Maastricht Bill, Parliament should accept. Should my noble friend press the amendment I hope that your Lordships will resist it.

5 p.m.

Lord Willoughby de Broke

My Lords, I thank my noble friend for her very full reply. I apologise for making her answer two agricultural debates within the space of one week when she has not had practice in doing so. I was not aware that my amendments had been forwarded for comment to the Procedure Committee. I look forward to its response. Of course, the whole Bill has been put to the High Court—which might be regarded as a committee of procedure—and I await its verdict with great interest.

I am mildly encouraged by the words of my noble friend concerning her determination that the Government will not go soft on the CAP. I am also encouraged by her detailed reply concerning the milk quota. I remain to be convinced whether that will achieve its objective. The outcome of many CAP reforms is often very wide of the objective which is sought.

I remain encouraged by my noble friend's determination not to go soft on the CAP. Accordingly, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 5 not moved.]

Lord Bruce of Donington moved Amendment No. 6: After Clause 1, insert the following new clause:

Exchange Rate Mechanism

(".Nothing in this Act shall have the effect of imposing any obligation on Her Majesty's Government to place the currency of the United Kingdom within the Exchange Rate Mechanism or any comparable mechanism for fixing exchange rates.")

The noble Lord said: My Lords, I hasten to assure the Government that this amendment is designed not to hinder but to be of assistance to them.

Those of your Lordships who do not suffer from political amnesia—which I expect includes all noble Lords present—will remember 16th September of last year when we left the exchange rate mechanism. They will recall that the then Chancellor—and it is surprising how Chancellors come and go—confided to us all that he was now singing in his bath as a result of the new liberty which had been given to the Government to free the exchange rate from the shackles of the exchange rate mechanism.

Those of us who remember that will have observed with interest the report in The Times yesterday, which was published after the Committee and Report stages of the Bill. It may therefore be of some interest to your Lordships. Under the byline of Mr. Torn Walker in Brussels, the report reads: The European Commission will on Thursday"— that is this coming Thursday— unveil radical blueprints for the second phase of monetary union in Europe, scheduled to begin next year, despite the fragile state of the existing European exchange-rate mechanism, which is expected to come under further stress this week with attacks on the Danish krone and the franc. The release of commission documents, outlining how a fledgling European central bank could punish EC states that failed to control spending, will coincide with the vital Commons vote on the Maastricht Treaty". The article continues: On Thursday, Jacques Delors, commission president, will discuss with colleagues four texts, detailing precise rules on Articles 104A and 109E of the Maastricht treaty, which aim to ensure that member states stick to their 'convergence' plans for a single currency by 1997". We stated to both the Government and Her Majesty's Opposition in the course cif debates that presently the Commission would unleash its energies in producing further rules and amplifications of Articles 104 and 109a of the Maastricht Treaty. I shall not say that we were exactly sniffed at, but there was a degree of mirth in some quarters that we should have hinted that such measures were already on the stocks. However, if the correspondent of The Times is as well informed as he usually is, it is quite clear that that is so.

One of our principal anxieties was, and still remains, that, despite the liberating effect of this country being forced to abandon the ERM, which has already been instrumental in easing forward a centimetre or so the green shoots of recovery that have been on offer for the past two or three years, there might be some endeavour by the Government to get back into the ERM. There are certain advantages. The political interests of the Government—I shall not mention those of Her Majesty's Opposition for the moment—quite clearly lie in using deflationary policies, in particular those associated with the maintenance of a high exchange rate, such as high interest rates, in the interests of those in receipt of fixed investment income. They form a quite considerable and significant part of government support. Therefore, there is always a slight bias—I put it no higher than that—towards the Governrnent getting back into the ERM again. Indeed, one has the feeling that there is a certain restlessness to get back to the old days of a rather higher exchange rate in which, as used to be said, the pound could look the dollar in the face. It did so several times, and occasionally looked downwards as well.

We wish to make quite sure that, if there is a move towards entering the ERM, there is nothing in the treaty requiring that. We made diligent inquiries to see whether any inference could be taken from the treaty to require Her Majesty's Government to re-enter the ERM at some stage in Stage 2 prior to their being required to exercise their option as to whether they should enter full monetary union. We had a certain amount of reassurance on that. To be fair to the Government, it appears to support their contention. In paragraph 36, the First Report of the Treasury and Civil Service Committee of Session 1992–93, published on 16th December 1992, states: In evidence to this Committee on 12 October 1992 the Chancellor again spelt out the conditions for re-entry to the ERM, emphasising: 'It is not a question of what one person might want, or what another person might want, it is a question of what is practical. It is not practical to return to the ERM until there is a greater symmetry between the policy in this country and Germany"'. A little later in the same paragraph the then Chancellor stated: We cannot consider rejoining the ERM, in my opinion, until two things have happened: firstly we are firmly out of recession and, secondly, there is a greater convergence between monetary policy in Germany and in this country".

There have been assertions to that effect. In giving evidence to the committee on 16th November 1992 Mr. Lamont stated: We do not believe that Maastricht requires any country to be a member of the ERM and, indeed, Greece has all but ratified the Treaty already and is not a member of the ERM. It is our view on the details of the Treaty that it does not require membership of the ERM. When you refer to Stage 2 you will recall that in Stage 2—and this was one of the main objectives that I had and I am the person who negotiated the monetary part of the Maastricht Treaty—that monetary policy remains entirely in national hands in Stage 2. That was my objective in the negotiations and I would never have negotiated that treaty and allowed the Government to sign it if I felt that Stage 2 in any way compromised the Government's ability to pursue its own monetary policy as it saw fit and I believe that that has been achieved in the Treaty. That is the legal advice that I have had and have always had".

On the face of it that seems to be quite conclusive. I am troubled by only one factor: the question of legal advice. I well recall in another place when the social chapter to the treaty was being discussed that the Government were advised by their then legal advisers in the Foreign Office that the social chapter formed an integral part of the treaty. If the social chapter were tampered with and taken out, the treaty would fall.

Legal advice does not come cheaply. I am quite sure that the Foreign Office legal adviser is a lawyer of the utmost repute; otherwise he would not be in that august position. Yet we have the peculiar position that, although that part of the treaty would come before, and has repeatedly been before, the appropriate Cabinet sub-committee—I believe that it is the ODSE, on which the Attorney-General is a permanent member—despite the legal advice having been given by the Foreign Office lawyer (and undoubtedly he is a distinguished gentleman), a few weeks later we find the Attorney-General advising that exactly the contrary is the case and in fact the social chapter could be detached from the remainder of the treaty without in any way injuring it. It is the reference by the Chancellor to legal advice that he has had which worries me.

As your Lordships will observe, the amendment inserts the following new clause: Nothing in this Act shall have the effect of imposing any obligation on Her Majesty's Government to place the currency of the United Kingdom within the Exchange Rate Mechanism or any comparable mechanism for fixing exchange rates". It does not seek to prohibit the Government in any way.

People who know me might suspect that I wish to place some limitation on the Government in that regard, but not a bit of it. In view of the ambiguities which can sometimes occur and the differences between conflicting legal advice, I merely seek a confirmation to be placed on the face of the Bill that the treaty contains no obligation on the Government to re-enter the exchange rate mechanism. I should have thought that that was quite harmless in the sense that it only underwrites precisely what has been said already. I hope sincerely that the Government will avail themselves of the opportunity and protection which I am anxious to offer them in this instance.

As regards my own party—and I must refer to the other side of the coalition on the Bill—I understand that it is the personal opinion of my noble friend Lord Peston that we should re-enter the ERM as quickly as possible regardless, whatever rate is available. He believes that it is necessary for us to do so. I am not sure whether there has been any official confirmation from on high that my noble friend's personal view is now official Opposition party policy. I should be glad to know whether it is. One likes to keep up with party policy even though it tends to be enunciated sometimes on the hoof. Perhaps my noble friend will tell me whether that is his personal position or whether, since his observations, it has now become party policy.

I am bound to say that my view that it is party policy, even though it has not been enunciated as such, is fortified by the fact that three days before we entered the ERM, three days before the Tory Party Conference of 1990 at which our entry into the ERM was announced at a figure of 2.95 deutschmarks, my party had advocated precisely that. Therefore, I presume, although I do not wish to presume too much, that it is now official party policy that we should re-enter the ERM at the earliest opportunity.

On the other hand, I should be equally obliged to know that it is not party policy because it would remove one area of conflict between myself and my Front Bench. I am most anxious to minimise that conflict because I find our existing differences most disagreeable. Therefore, I should be obliged to know whether the view of my noble friend Lord Peston is his personal view or official party policy.

I must warn my noble friend that he may be in the position of being two speed on the matter and being half on and half off the train initiated by the Government in that regard—a complete reversal of the position with regard to EMU. Perhaps my noble friend will reply to that. I beg to move.

Lord Hamilton of Dalzell

My Lords, I moved a similar amendment on Report and I hope that my noble friend on the Front Bench will forgive me if I return to some of the points that I raised then.

Most of us on this side of the House would agree that our joining of the ERM was a mistake because it is a fair weather policy. It will be bearable only when exchange rates are static because the markets are static. As matters stand, when that occurs we can rejoin if we so desire, and there are those who would wish us to do so, particularly on the other side of the House.

On Report I asked whether we would be forced to join. In his reply to the debate on Report my noble friend Lord Caithness relied on the EMI statute, Article 3.1, which he says clearly states that monetary policy remains in the hands of national authorities during Stage 2 of EMU. I agree that that is what it says, but unfortunately it is patently misleading. It is an economic non sequitur, a nonsense, because it is impossible to use monetary policy to keep the exchange rate static while using it at the same time to control the growth of the domestic economy. All those countries which are still in the ERM have their interest rates tied to those required by the domestic problems of the German economy rather than to their own requirements. After all, that was the fundamental reason why we were forced to leave it. Monetary policy is not in the hands of those nations and cannot be while they are still in the ERM.

My noble friend relied also on the specific exemptions accorded to Britain in the United Kingdom protocol which states that if we notify the Council that we do not intend to move to Stage 3, the United Kingdom shall retain its powers in the field of monetary policy according to national law. The question arises whether that assurance might not also suffer from the same fallacy as is apparent in the EMI Article 3.1 and stem from the same misunderstanding of the economic facts of life in claiming that monetary control can still remain in national hands in a fixed exchange rate regime. The purpose of the amendment is to put the matter beyond doubt by underwriting what appears to be the Government's policy in that regard.

In our previous debate I quoted the words of the noble and learned Lord, Lord Wilberforce, and my noble and learned friend the Lord Chancellor in describing the processes of the European Court of Justice, the Supreme Court, as being "producive"; that is, it interprets the law according to its intentions rather than according to, as has hitherto been the practice of the British courts, what is written in the statute. There can be little doubt as to what is the intention behind the Treaty of Union.

I fear that without the amendment there may be differences as regards the interpretation of Article 109e(2) of the treaty which requires that each Member State shall adopt before the start of Stage 2: multiannual programmes … of convergence necessary for the achievement of economy and monetary union"; Article 109j(1) which states that: The Commission and the EMI shall report to the Council on the progress made in fulfilment by the Member States of their obligations regarding the achievement of economic and monetary union"; and Article 109m which states that: Until the beginning of the third stage, each Member State shall treat its exchange rate policy as a matter of common interest". In that I am supported by other legal opinions and that of Charles Goodhart. Is that another matter which will be settled in the courts, or will the Government accept this amendment?

Lord Monson

My Lords, I rise to support the amendment. The noble Earl, Lord Caithness, has assured me on at least two occasions that nothing in this Bill will have the effect of imposing any obligation on Her Majesty's Government to re-enter the ERM. The purpose of the amendment is to enshrine that very firm and definite assurance in law, just in case the noble Earl should move onto higher pastures and his successor may turn out to be rather less firm and resolute in that regard. What could be more reasonable and welcome than that?

5.30 p.m.

Lord Tebbit

My Lords, I believe that we have here a slight difficulty which I can explain. It seems to me that there are a number of people of not inconsiderable ability or intellect who find that the provisions of the treaty in that regard, as well as in many others, are somewhat unclear and that there can be argument between men of goodwill and considerable experience one way or the other.

My noble friends on the Front Bench say, "No, no, it is not unclear at all. It is very clear". They therefore resist what would otherwise seem to be perfectly sensible amendments to ensure clarity. One reason that they resist those amendments is that they would resist any amendment to this Bill. That is part of the way in which this legislation is carried through. It is legislation which, in effect, must not be amended. At the very least, it would require sending it back and forth to the other place, thereby delaying not only the ambitions of the Government to ratify the treaty—which seem to have been a little postponed by the activities of the noble Lord, Lord Rees-Mogg—but also the departure of this House to more seasonal attractions as we approach, for example, 12th August. But there may be another reason, and I should like to explore it for a moment with my noble friends.

What I may delicately refer to as "my Brussels correspondents" tell me that at the ECOFIN meeting last week the Chancellor of the Exchequer made it very plain to his colleagues in the closed session meetings that he was firmly in favour of Britain resuming its place in the exchange rate mechanism. That was not to be now because at the moment conditions are not appropriate to do so. But I understand that he was very clear that it was his intention that we should resume our place in the mechanism. If that is so, it provides a perfectly reasonable case for the Minister to resist all the amendments which come forward. He will say: "What is the fuss about? We are not going to be forced into it; we are going to jump willingly into it, as we willingly jumped into it a little while ago".

If that is indeed the case, I can understand the logic of my noble friend saying that we do not need this amendment; that it is only an embarrassment and an encumbrance. But I should like my noble friend, when he replies, to assure me very clearly and firmly that the Chancellor has not been saying any such thing in the ECOFIN meetings; that he has been saying very firmly that the Government at the moment have no policy towards whether or not Britain should re-enter the exchange rate mechanism; that these are extremely difficult issues; that our experience has been very unfortunate with membership; and that our experience since we left the exchange rate mechanism has been very favourable.

Indeed, I understand that the Prime Minister says to many people in many different places that few people would have believed 12 months ago that we could make the enormous progress that has been made in our economy. We are now competitive with our friends on the Continent; in Germany, for example. Our costs relative to theirs have fallen sharply. Our interest rates are down sharply as against theirs. All these things have been achieved outside the exchange rate mechanism and could not have been achieved while we were inside it. So I would be very uneasy were there to be a proposal to re-enter.

I am sorry that the noble Lord, Lord Callaghan, is not in his place. I intend to refer to him and I have not had time to let him know. But what I say will not be in any way derogatory. I believe that, as history is written, it will be very much kinder about the noble Lord than perhaps contemporary history has been, or indeed his contemporary opponents such as myself. I have formed the impression that the noble Lord was seldom wrong in his first judgment and response. Sadly, the longer he considered things, very often the more wrong he was. I see a nod from the Labour Benches opposite, from my old sparring partner the former general secretary of the TUC. I shall not explore that matter further.

Yesterday I was given a copy of a document entitled James Callaghan on the Common Market. It is priced at only 10p—surprisingly good value—and is published by the Labour Committee for Safeguards on the Common Market. It is a copy of a speech which the noble Lord made on 25th May 1971 at Bitterne Park School, Southampton. Let me find the most relevant part, because I do not want to read too much. The noble Lord says on page 2 of the pamphlet: A rigid relationship with the E.E.C. countries' exchange rates could have a serious impact upon employment in this country. What would Mr. Heath do when that situation arises? He will be faced with the difficult alternative of either staying with the Common Market policy and putting our own people second, or of breaking faith with the Common Market and inviting their odium in order to protect the British people. My own view is that in the event of such a clash arising, British Ministers—even Tory Ministers—would eventually act in what they thought were Britain's best interests, even if that meant flying in the face of Common Market philosophy and agreements. That is what the German Government has just done over its own currency. But do we wish to start on such a course without a clear understanding with the French and others that this is what we should do?". That is a classic description of what happened last year. I do not think that any of us would want to go through that experience again.

I think it would be appropriate if my noble friend would tell us whether or not the Chancellor has been giving any understandings to our friends in the Community that we intend to re-enter the exchange rate mechanism. By the way, I did not ask for an assurance that we would not enter in this Parliament. No, no, no. What I want is an assurance that there is no intention for the foreseeable future of re-entering. We in this country have learnt our lesson and do not believe that fixed exchange rate mechanisms benefit our people.

The other day the Belgian transport minister was reported as complaining bitterly that it was unfair that British Airways pays many of its staff less than the wages which are paid by Sabena. He claimed that if only its wage rates were the same as those of British Airways, it would be put into profit rather than loss. He was asking that under those provisions of the treaty (indeed the Single European Act) concerning the level playing field of competition, something should be done about this. The easiest, and simple, way to do something about it would be to raise the parity of our currency against the others in such a way as to raise the wages of British Airways' staff relative to those of Sabena; to render British Airways as uncompetitive in the world as Sabena is. I say again: the noble Lord, Lord Callaghan, was almost certainly right in his initial reaction to the concept of the exchange rate mechanism.

Lord Jay

My Lords, if the noble Baroness would accept this amendment, or treat it in a favourable light, she would very much reassure a large number of people. After all, in the past three years we have had practical experience both of joining and of leaving the exchange rate mechanism. Two years of experience is worth a great deal of theory and argument.

When we joined the ERM, in two years we had an extreme deflationary policy imposed on us, with high interest rates and an overvalued exchange rate. The upshot was that unemployment rose by nearly 1.5 million in those two years. Since we left the exchange rate mechanism 10 months ago, in September, interest rates have fallen and the exchange rate has dropped to a competitive level. That was largely responsible for the beginnings of some kind of recovery at the present time. The Government claim it as some mysterious virtue of their own but the dates prove beyond any serious shadow of doubt that the main reason was our escape from the exchange rate mechanism. Some people think that nobody in his right mind after that experience would want to go back.

My second and more modest reason for asking the noble Baroness to look favourably on the amendment is that I see no reason why she should not accept it. It does not prevent the Government from rejoining the ERM if ever they are so foolish as to want to do so. It merely refrains from placing on them an obligation to do so. It leaves the Government perfectly free either to join or not join as they wish. Therefore I cannot see that any harm will be done by accepting the amendment. Quite certainly it would reassure a great number of people about the immediate prospects.

Lord Boyd-Carpenter

My Lords, I share the view of my predecessor as Financial Secretary to the Treasury, the noble Lord, Lord Jay, on the merits of the ERM. It was a disastrous decision when we joined it and a very sensible one when we left it. I should certainly oppose any move to go back into it.

What troubles me a little about the amendment is that it appears to be hitting at nothing. I can see nothing in the Bill that would involve any commitment whatever for us to return to the ERM. Nor in listening to this debate and the very able speeches in support of the amendment have I heard any quotation whatever indicating that there is anything in the Bill which would impose on us an obligation to go back into the ERM.

Therefore, although the sentiment, which I fully share, that we should not go back into the ERM is thoroughly sound, I cannot see any practical reason why it is necessary to put into the Bill a denial that there is anything in it of that sort. I have not seen, and nor has any noble Lord who has spoken seen, any indication in the Bill that it would impose an obligation on us. If that is right and there is no obligation, it seems to me that it is bad draftsmanship solemnly to impose a prohibition of this sort.

Lord Pearson of Rannoch

My Lords, perhaps I could help my noble friend Lord Boyd-Carpenter. At the previous stage of the Bill I quoted in some detail the opinion of Professor Charles Goodhart, who is the Professor of Banking and Finance at the London School of Economics and who was the Chief Economic Adviser to the Bank of England from 1980 to 1985. My noble friend on the Front Bench at the time did not fully reply to the quotation which I gave then. I believe that in some way he felt that Professor Goodhart was muddled up with an opinion given by Mr. Martin Howe in a paper called Monetary Policy after Maastricht, which my noble friend indicated had been comprehensively dismissed by the Treasury.

In those circumstances I wonder whether I could put back on the record the opinion of Professor Goodhart, which was referred to by my noble friend Lord Hamilton of Dalzell in his opening remarks. Perhaps I could ask my noble friend on this occasion not to inform us that the Treasury has dismissed Mr. Martin Howe's opinion but how the Government dismiss Professor Charles Goodhart's opinion, which reads as follows, Article 109e(2) of the Maastricht Treaty requires each member state to adopt, before the start of Stage 2 of monetary union on 1st January 1994, a 'multiannual programme' of convergence for achieving economic and monetary union. [I] consider"— that is, Professor Goodhart considers— that this article, read in conjunction with Article 109j(1), which sets out the 'convergence criteria' for entry to the third stage, will oblige the UK either to give a date in its multiannual programme for intended return to the Exchange Rate Mechanism, or at least to set out clear criteria for such a return, and"— this may be the point that my noble friend Lord Boyd-Carpenter was looking for— to express a statement of intent to work towards that". That is the opinion of a gentleman who is very well qualified. I should be grateful if my noble friend could knock him off his perch rather than relying on the Treasury knocking Mr. Martin Howe off his perch.

Lord Boyd-Carpenter

My Lords, before my noble friend sits down, would he indicate where in the Bill there is any proposal whatever to compel us, if we do not wish it, to rejoin the ERM? The passage that he quoted gives some amiable intentions. As I understood it, it imposes no obligation whatsoever.

Lord Pearson of Rannoch

My Lords, with the leave of the House, the opinion says that we have to express a statement of intent to work towards setting out clear criteria for such a return. If that statement of intent is given in good faith and means anything, I think it comes near enough to what my noble friend Lord Boyd-Carpenter is asking me to ask my noble friend to reply to.

5.45 p.m.

Lord Peston

My Lords, we have covered a range of topics. At risk of boring your Lordships, perhaps I may deal with just one or two matters raised by my noble friends. I should like to start with my noble friend Lord Bruce of Donington and explain to him the simple logic. The Labour Party is committed to joining EMU—full stop. That is sentence number one. A precondition of joining; EMU is to have been in the exchange rate mechanism for two years within the narrow bands. That is the second sentence. Since we are committed to the first, we are committed to the second. That is in party policy. But even if it were not written out, it is a simple matter of logic. I said to him "in my judgment" because I rather hoped that he would respect my judgment more than my simply telling him that it was written down in party policy. But if he wants to have it the other way round, either way that is it—full stop; end of argument there.

My noble friend Lord Jay, the noble Lord, Lord Boyd-Carpenter, and others seem to have become great advocates of floating exchange rate policies. Indeed, last week my noble friend Lord Stoddart said that fixed exchange rate systems were always bad and were to be avoided. Because of the conventions of the House I was not able at that time to argue with him. If he will forgive me, I shall say a few words on that matter now. In terms of basic economics it is quite serious.

First, in my judgment—I speak as a professional economist—during the period of the most famous of all fixed exchange rate systems—namely, the gold standard—on the whole the world prospered. By that I mean the Victorian age and all of that time. The famous case (the Keynes case) against the gold standard was when Winston Churchill returned to the gold standard. That was the famous crucifixion on the cross of gold, which had to do with going in at the wrong rate. At no stage, I remind my noble friend Lord Jay, did Maynard Keynes as a result of that favour floating exchange rate policies. At no stage did he do that. He was the architect of the great post-war recovery, from which the western world gained enormously—namely, the Bretton Woods system. The essence of the Bretton Woods system is that it is a fixed, though adjustable, exchange rate system. It is precisely an ERM system. Therefore the argument that somehow the world has benefited from floating exchange rates seems to me not to stand up for one moment.

I believe that the noble Lord wishes to interrupt me.

Lord Tebbit

My Lords, the noble Lord will detect two crucial differences between the gold standard and a fixed exchange rate à la ERM or any other European system. The European systems are fixed essentially against another currency in the exchange rate mechanism. That is one point. The second point is that in the gold standard people were free to devalue; they did not enter into a treaty commitment not to do so.

Lord Peston

My Lords, that is to do with EMU. My noble friend was talking of fixed exchange rate systems as opposed to EMU per se. I suppose I am simply wearing my academic hat. I felt it right to set those arguments out.

Let me make one final point to my noble friends who have decided that they favour floating exchange rate systems. The architect of floating exchange rate systems is the most extreme right wing and pro-free market and anti-interventionist economist in the world. Milton Friedman happens to be a brilliant economist, but the notion that my friends are espousing the views that he is putting forward is surprising.

Professor Friedman does not put forward those views along the same lines as my noble friends; that is to say, that we can now engage in active economic policy. He was the greatest architect of saying that there must be no government intervention in macro-economic policy at all. Again, I am sorry to be criticising my friends because everybody knows how emollient I am at all times. The idea that they favour a floating exchange rate system in order to follow the doctrines of Professor Friedman, which are totally non-interventionist in that they say that fiscal and monetary policies are neither desirable nor will they work, is strange coming from my noble friends with whose views on active policy I am familiar.

I make the same comment to the noble Lord, Lord Hamilton of Dalzell. He too seemed to favour floating exchange rate systems but equally felt that he could see a case for active monetary policy. I am afraid that he cannot. Let me ask him also, because that is what interests me, whether or not he reflected on why, with the needs of the British economy requiring some expansion measures at this time, his right honourable friend the Chancellor of the Exchequer is fearful of cutting interest rates, given that monetary policy remains entirely in national hands. If monetary policy remotely remained entirely in national hands I am certain that his right honourable friend the Chancellor of the Exchequer would certainly lower interest rates. But he knows what would happen if he even suggested lowering interest rates.

That has taken us some way from the amendments. I felt that it was my only opportunity to talk on economics, which at least interests me. What I want to say on the amendment perhaps revolves around the semantics of the word "obligation". I am delighted that the noble Lord, Lord Pearson of Rannoch, quoted the view of my old friend Charles Goodhart, because I entirely agree with him. Unless we regard the Government as dishonest, which I have been at pains over some weeks to say that I do not, the presumption of the Maastricht Treaty is for EMU and therefore for ERM. If that were not the case the Government would announce that they were exercising the opt-out, which we all know they are not going to do.

Charles Goodhart points out that the Government are "obliged" to take seriously the possibility of going into EMU. They are also therefore obliged to take seriously the possibility of following the ERM. For the Government to say that they have no obligation on the matter is plainly wrong. The noble Earl said it, and I have to tell him that he is wrong. To say that is essentially to say that all we are going to do for the next couple of years in terms of the British economy will have nothing whatever to do with meeting Maastricht and EMU.

I shall not delay the House for long. I have a great many other notes on the subject but I shall not prolong the matter. I wish the amendment to be rejected not because it is not necessary, but because it is unacceptable. If that is the Government's view, then I do not know why we signed the treaty in the first place. I do not see how we proceed if we announce in terms that we have no obligation. My judgment is that Charles Goodhart is right, and is right to be right. I support Maastricht; I support EMU and I support our rejoining the ERM.

My noble friend Lord Bruce referred to the coalition. The problem is that there is no coalition. There is us. The others are just floating around not knowing what to do and having no view on what is the central economic issue of our day. I hope therefore that the amendment is rejected. I shall vote against it, not because it is not needed, but because it is mistaken.

Lord Stoddart of Swindon

My Lords, my noble friend referred to me and I therefore feel obliged to say a few words in my defence. He mentioned my remarks in regard to fixed exchange rates. I remind him that with one or two other noble friends such as my noble friends Lord Bruce and Lord Jay, I was one of the few who opposed consistently our entry into the exchange rate mechanism. Once we were in it we had some disagreement as to whether or not I should continue to call for a devaluation.

Having a floating exchange rate does not preclude fiscal and monetary measures in support of the system. My problem with fixed exchange rates is not only the rate at which one enters, but how one keeps that rate. How do we fix and keep the rate fixed at that level? I fear that what happened is that we have not been able to keep the rate fixed within the ERM without increasing interest rates inordinately, causing businesses to collapse and unemployment to rise. That is my problem with fixed exchange rates. First, how do we fix the correct rate at which to go in? Then, in the light of changing economic circumstances, how do we maintain that fixed rate? I hope that helps my noble friend.

The Earl of Caithness

My Lords, I know that the whole House is feeling increasing concern for the noble Lords, Lord Bruce of Donington and Lord Stoddart of Swindon. It must be an uncomfortable position to be in. Every time the noble Lord, Lord Bruce of Donington, rises and hopes that Labour Party policy is not quite what he thought it was, he is smartly smacked down into his box by the noble Lord, Lord Peston, who says that of course it is Labour Party policy. I am sorry for the noble Lord, Lord Bruce of Donington. He is a man of great principle. He may feel that other parts of the House are more comfortable places from which he can continue to entertain your Lordships, because we all listen to him with great interest.

I listened to him with great interest today. He started by saying that he felt sure that none of your Lordships is suffering from amnesia. I expected him to refer to another issue. He referred to September last year. I will bring your Lordships closer up to date. I refer your Lordships to a week ago, 13th July, where an amendment was discussed word-for-word for over an hour, even though the noble Lord, Lord Bruce, did not take part. It is for that reason, not discourtesy to your Lordships, that my response will be particularly brief today.

I listened with care to what the noble Lords, Lord Jay, Lord Stoddart of Swindon, and other noble Lords, said. It was interesting though nothing to do with the amendment. It was all to do with the merits of the ERM.

I apologise for stopping my noble friend Lord Hamilton of Dalzell when he was speaking on Amendment No. 3 and went on to the amendment we are now discussing. It was worth waiting to hear what he had to say. He said what I intended to say. He quoted virtually what I said at Report stage. I do not wish to bore your Lordships again. I simply refer to the EMI statute Article 3(1), the commitments that we have made and the position in the UK protocol which is well known to your Lordships. In response to my noble friend Lord Tebbit I say that I set out clearly the Government's position with regard to the ERM at col. 182 a week ago. Needless to say, the situation has not changed.

The noble Lord, Lord Bruce of Donington, produced a somewhat lurid article from a certain newspaper that he has the habit of reading from time to time. I know that the noble Lord read the treaty extremely carefully and I admit that he probably knows it better than me. However, if he looks at Articles 104A(2), 104B(2) and 104E(14) he will see clearly that further secondary legislation is to emanate from the Commission. That will be dealt with in the usual way. It will go to ECOFIN. It will be available for discussion through your Lordships. There is nothing to worry about. It is all there in the treaty, and at no stage have we sought to deny it.

The crux of the matter comes to what my noble friend Lord Boyd-Carpenter said. He dislikes the ERM. But this is not a debate on the ERM. There is nothing in the treaty that commits the United Kingdom. He answered effectively the point raised by my noble friend Lord Pearson of Rannoch. I have looked again since we discussed the matter a week ago and I can find no requirement in Article 109e(2) or Article 109j(1) or elsewhere for a member state to join or rejoin the ERM or indicate a date when it will join or rejoin.

6 p.m.

Lord Hamilton of Dalzell

My Lords, before my noble friend sits down, perhaps I may make this point. He dismissed my argument. I was trying to make out that the EMI statute—Article 3(l)—gave no defence against our being forced into the ERM on the ground of it appearing to maintain that while being in the ERM one still has complete control over one's own monetary policy. Therefore, it would be perfectly possible to comply with the article and still be in the ERM.

The Earl of Caithness

My Lords, I listened with care to my noble friend's argument. Certainly, I did not dismiss it lightly. It would be quite wrong to do so. He is right to say that Article 3(1) clearly states that monetary policy remains in the hands of national authorities during stage 2 of EMU. That, combined with the UK protocol, clearly confirms that the Government's interpretation of the treaty is an accurate one; and what I have said before on many occasions remains the case.

Lord Bruce of Donington

My Lords, I am most grateful to both noble Lords for the response they have given to my arguments in favour of the amendment. My noble friend Lord Peston must not try to impute to me or indeed to my colleagues any continuity with the policies of Milton Friedman. Milton Friedman is a strict non-interventionist whereas I, as is well known, belong to the Heseltine school of intervening in the economy, if necessary three times a day before meals, in order to establish the rate of exchange at a level which is roughly around purchasing power parity. I trust that my noble friend will not try that one again, because I am not that naive.

I am most grateful to the noble Earl, Lord Caithness, for being so solicitous on behalf of my political health. I note his welcome to move around the House to a position which possibly he might find more agreeable. I have to say that I have been in politics and in the Labour Party since 1935, which is a long time. Most of the Front Bench here were in knickerbockers; perhaps they were not even yet born. I have observed the various vicissitudes through which my party has passed. I can assure the House that the events of today bear some astonishing resemblances to events of 40 or 50 years ago which I managed to survive with an undying loyalty towards the party of which I am very proud to be a member. I regret, as some of my colleagues do, the disappearance from the Labour Party's manifesto of the word "socialism" to which I am still committed. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Monson moved Amendment No. 7: After Clause 1, insert the following new clause:

("Cohesion funds: review .—If at any time—

1. (a) it appears to Her Majesty's Government that the date for the entry of the Community into the third stage of Economic and Monetary Union is, or is likely to be, delayed beyond 1st January 1999; or
2. (b) the United Kingdom notifies the Council that it does not intend to move to the third stage;

then Her Majesty's Government shall lay before Parliament a report which shall—

1. (a) review the contributions made by the United Kingdom to the cohesion funds of the Community;
2. (b) examine the question of whether it would be appropriate to renegotiate the future contributions of the United Kingdom thereto; and
3. (c) set out the policy of Her Majesty's Government in respect thereof.")

The noble Lord said: My Lords, Amendment No. 7 is perfectly clear and self-explanatory and therefore I shall not weary your Lordships by going through it line by line. We are constantly being told by enthusiasts for the Maastricht Treaty that the European Economic Community is a club, that we must abide by club rules and that it is positively unseemly and bad form to question or complain about those rules. But what a very curious club it is where 17 per cent. of the members pay a truly enormous subscription, which they can ill afford; 50 per cent. of the members pay virtually no subscription at all; and the remaining 33 per cent. not only pay no subscription but are handsomely paid for graciously deigning to remain members of the club.

As I have pointed out on two or three occasions, none of the so-called poor members of the Community—neither Spain nor Portugal, nor Greece, nor the Republic of Ireland—is poor in any objective sense. They are all numbered among the world's better-off countries. When this country has to live with a deficit of between £50 billion and £55 billion, a deficit which is expected to persist for many years to come, we must be extremely careful with the money that we really do not have, especially when we consider that fraud and waste are involved in so many intra-Community transfers.

I am sure that all noble Lords would agree—not least noble Lords on the Labour and Liberal Democrat Benches—that if we have any money to give away to other countries it would be better directed to genuinely poor countries, whether they be in Eastern Europe, in Asia, in Latin-America, in Africa or the Caribbean, rather than to countries that are not genuinely poor but merely relatively poor in relation to, say., Switzerland, Sweden or Germany. Of course, most people who have actually studied the matter are well aware that the real purpose of cohesion funds has nothing to do with the relief of genuine poverty. It has to do with artificially boosting the economies of the so-called poor countries to prepare them for stage 3 of EMU which takes place, theoretically at any rate, in less than five-and-a-half years' time.

Free trade and the removal of barriers in consequence of the single market will in any case ensure that the economies of the currently slightly less well-off countries will grow and converge with those of the currently better-off countries in perhaps 15 to 20 years' time without the need for any cohesion money to speak of, provided that they do not artificially burden themselves with high labour costs—at least not before their productivity has improved to the level pertaining in the currently better-off countries. Therefore, if stage 3 does not come about, or if it is delayed beyond the target date, most of these cohesion transfers will be unnecessary.

One of the great achievements of what we call the Thatcher years is that people at long last have come to realise that there is no such thing as government money; it is all taxpayers' money. I am not so sure that people have yet come to realise that there is no such thing as European Economic Community money. That, too, is taxpayers' money, mainly that of the taxpayers of Britain and Germany. With higher taxes and/or large cuts in public spending in the pipeline it will not be long before people here come to realise that. I beg to move.

Baroness Chalker of Wallasey

My Lords, I listened with care to what the noble Lord, Lord Monson, said in moving this amendment. It seems to me that he is in a sense confusing the ideas of convergence and cohesion. The difference is an important one and, therefore, perhaps it will be for the convenience of your Lordships' House that I explain it.

As the noble Lord correctly said, strengthening cohesion means reducing economic disparities between the regions of the Community. As he knows, that objective first appeared in the treaty in the Single European Act 1986. We have reaffirmed that in the Maastricht Treaty under Article 130a. But I must say to the noble Lord that it is a question of levelling up, and not levelling down, those countries which already have done better in economic terms.

Promoting convergence means ensuring that the different European Community economies could move to, and operate within, a single currency without substantial disruption as set out in Article 109j of the Maastricht Treaty and the protocol on convergence. Many may argue that that will never happen, but it actually means that in any case.

Strengthening cohesion and promoting convergence are linked in so far as both depend on the 12 member states pursuing responsible economic policies and sound public finance which ensures low inflation and structural reform to bring about flexible economies.

I now come to the difference between convergence and cohesion. The difference is that convergence is required for a single currency while cohesion is not. Convergence in particular of interest rates, public deficits, inflation and the structure of economies would be necessary for the effective operation of a single currency. Cohesion—which is reduced disparities in living standards—although an important objective, is not a necessary condition for the operation of a single currency.

The amendment of the noble Lord, Lord Monson, appears to be based on the premise that the operation of a single currency will require large transfers of funds between rich and poor member states and that if we are not participating in a single currency we should consider whether it would be right that we should contribute to such transfers. As I have explained, such cohesion spending would not be required to bring about the necessary convergence for a single currency. That requires governments to follow sensible economic policies. So cohesion and convergence are different concepts and that is my reason for urging the noble Lord, Lord Monson, to withdraw his amendment.

Lord Monson

My Lords, I am grateful to the noble Baroness, Lady Chalker, for her very full reply. I appreciate that there is a dividing line between convergence and cohesion. The trouble is that I am not sure that the countries on the receiving end of these transfers make that distinction themselves. In speaking to Amendment No. 4 the noble Lord, Lord Willoughby De Broke, rightly drew our attention to the Danegeld, as he put it, which had to be paid to a number of our EC partners to get them to agree to even the smallest reform of CAP.

From the other side of the House the noble Lord, Lord Fitt, reminded us on 9th July, in a debate on Northern Ireland, of the astronomical billions of pounds of cohesion money that was being paid to the Republic of Ireland as a quid pro quo for their agreeing to the Maastricht Treaty. Once again, that is an example of Danegeld. I believe that the amendment is a reasonable one, but time is getting on. Therefore, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.15 p.m.

Lord Pearson of Rannoch moved Amendment No. 8: After Clause 1, insert the following new clause:

Justice and Home Affairs: voting by unanimity

(" . Without the prior approval of Parliament, Her Majesty's Ciovernrnent shall not give its consent to any voting under Article K.3 of Title VI of the Treaty on European Union (Justice and Home Affairs) which is not on the basis of unanimity.").

The noble Lord said: My Lords, as I am sure most of your Lordships will be aware, Title VI (or Article K) of the union treaty covers proposed Community co-operation in the fields of justice and home affairs. It is to be binding in international law and covers such important matters as asylum policy, immigration, terrorism, and drug running.

The Government's line on Title VI is that under it our sovereignty is safeguarded because it can only be operated by unanimity—that is to say, with our consent. The amendment would confirm that position. But the wording of Article K does not appear to be so clear cut. So I thought that it might be helpful for my noble friend the Minister to put on record how the Government interpret the clause and how they intend to operate it. For instance, Article K.4(3) says: The Council shall act unanimously, except on matters of procedure and in cases where Article K.3 expressly provides for other voting rules". So we come to Article K.3, the subject of this amendment, which seems to wander about a bit. For instance, it envisages drawing up conventions which the council may recommend to member states for adoption. It appears that measures implementing those conventions could be adopted by a two-thirds majority of the high contracting parties which is the somewhat hubristic terminology used in the treaty to describe its signatories. In other words, it can be agreed by a two-thirds majority of the member states.

Article K.4(3) also envisages the use of qualified majority voting in unspecified areas which is presumably not the same procedure as a simple two-thirds majority of the member states. On my reading of Article K.3 it would appear that we could be committed to things called "joint positions" by majority voting of one kind or another. Can my noble friend describe what a "joint position" is going to be?

I ask that because when we had a similar debate on Title V (or Article J) of the treaty, my noble friend was good enough to explain what "joint actions" were to be under those clauses. It would he very helpful to have a similar description of "joint positions" in Title VI. Since I have a feeling that my noble friend is going to say that the amendment is unnecessary, can she explain exactly how our sovereignty is to be safeguarded under this clause, because unanimity does in fact prevail? I beg to move.

Lord Harmar-Nicholls

My Lords., if my noble friend is right in saying what he believes the noble Baroness is going to say—that is, that the amendment. is not necessary—I hope that she will keep in mind that the spirit behind the amendment is very necessary indeed because one thing that has disillusioned a great many people is the easy way that, under the Treaty of Rome, we have been allowed to slide away from the unanimity protection to a situation where now it is sufficient to have a majority. Things have happened which we were led to believe would not happen because we would use the power of the veto.

The point I am making is that although my noble friend the Minister may use as an argument that the insertion of these actual words in the Bill is unnecessary, the spirit behind them is very necessary. I would like to have my noble friend's reaction as to exactly how she feels about the matter.

Lord McIntosh of Haringey

My Lords, this amendment is a very pale shadow of the amendments, tabled at earlier stages on the subjects of justice and home affairs. At previous stages it was suggested that those two matters were wrongly included in the treaty and that we should not be co-operating with other member states on them within the context of the treaty. All that opposition appears to have faded away, or it is not being reflected in amendments.

Lord Bruce of Donington

My Lords, do we want more then?

Lord McIntosh of Haringey

My Lords, I am sorry to say to my noble friend that there is no opportunity for further amendments to the Bill to be tabled in this House. We now have what appears to be an extremely minor concern about Article K.3. In introducing this amendment, the noble Lord, Lord Pearson, did not read out what that article says. That article is concerned with, collaboration between the relevant departments of their administrations of member states and member states informing and consulting each other within the council. It is concerned in particular with co-operation, contributing to the pursuit of the objectives and with conventions recommended to member states for adoption. They are not imposed on member states but recommended for adoption in accordance with their respective constitutional requirements.

The article then goes on—and only then—to say that unless otherwise provided by such conventions, measures implementing them shall be adopted by the Council by a majority of two-thirds of the high contracting parties who, by the way, are the heads of state. The signatories to the treaties are not the high contracting parties. There is no hubris in saying that the Foreign Secretaries and Prime Ministers shall sign on behalf of the high contracting parties, who are the Queen of the United Kingdom of Great Britain and Northern Ireland, the Grand Duke of Luxembourg, and so on.

Bearing in mind what seems to be relatively widespread agreement that issues such as asylum policy, external borders, immigration policy and the combating of drug addiction are proper matters for the European Community and a European Union, I find it difficult to see why noble Lords should persist in seeking that co-operation of this kind, which is not binding on member states, should not be adopted by a two-thirds majority.

Earl Ferrers

My Lords, perhaps I may first put my noble friend Lord Harmar-Nicholls right on one matter. He predicted that my noble friend Lady Chalker would say that the amendment is not necessary. My noble friend Lord Harmar-Nicholls is wrong. My noble friend Lady Chalker is not making such a statement; I am.

My noble friends Lord Harmar-Nicholls and Lord Pearson of Rannoch both argue that the wording of the amendment may not be important but that its spirit is. They are, of course, right. I hope that I shall be able to show them that the amendment is not necessary because the spirit of it is already in the Bill.

My noble friend Lord Pearson was concerned about joint positions. Perhaps I may advise him that a joint position would relate to a common approach that the member states might wish to adopt with respect to a problem which has been dealt with in, for example, an international organisation.

The wording of Article K.3(2) (b) is a little complicated and I quite understand that my noble friends may find it difficult to absorb exactly what it means. I shall try to explain it as carefully as I can. Article K.3(2) (b) says that the Council may, decide that measures implementing joint action are to be adopted by a qualified majority". If this were considered to be the appropriate way of proceeding, the decision of the Council to adopt qualified majority voting will actually have had to be one of unanimity. In other words, the United Kingdom has the right and the ability to veto any moves to qualified majority voting on implementing measures if we do not approve of the proposals.

Article K.3(2) (c) states that the Council may, draw up conventions which it shall recommend to the Member States for adoption and that, Unless otherwise provided by such conventions, measures implementing them shall he adopted within the Council by a majority of two-thirds of the member states.

Again, member states would have to agree the text of any such conventions. That agreement would have to be a unanimous decision. When the details of the conventions, which have been the subject of a unanimous vote, come to be put into operation, that implementation of the convention will be done by a two-thirds majority—but only if the United Kingdom has approved the convention on that basis.

In fact, we do not anticipate circumstances where we would agree to the implementation of any convention on the basis of a two-thirds majority. The United Kingdom will therefore see that there is a clause inserted into each convention, which will stipulate that the implementation of the convention will only come about after a unanimous vote.

Lord Harmar-Nicholls

That is what I call "the spirit".

Earl Ferrers

My noble friend makes an interjection in which I thought I heard him say that that was what he called "the spirit". He is, for once, correct.

If our European colleagues were not to agree to the inclusion of such a clause of unanimity in a convention, then there would be no convention, as the convention itself would require unanimous approval and we would not be prepared to give our approval to a convention which did not allow for unanimous approval.

The article is complicated. Had my noble friend Lord Harmar-Nicholls not interrupted and destroyed the flow of thought, perhaps your Lordships would have understood it even better. I hope that your Lordships will realise that the amendment is not necessary because, in the words of my noble friend Lord Harmar-Nicholls, "the spirit" is there.

Lord Pearson of Rannoch

My Lords, I am most grateful to my noble friend, particularly for admitting that the wording is complicated. I dare say that a number of your Lordships agree that the word "complicated" is a somewhat polite way of putting it. I also notice that the declaration on voting in the field of a common foreign and security policy, which forces or pushes us towards a unanimous vote when a qualified majority vote exists for Article J or Title V of the treaty, does not apply in this case to Article K. Therefore, I am grateful to my noble friend for what he has said. I very much hope—indeed, I assume—that it will stand the test of time. I am therefore happy to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 [Annual report by Bank of England]:

Lord Pearson of Rannoch moved Amendment No. 9: Page 2, line 3, after ("order") insert ("made by statutory instrument").

The noble Lord said: My Lords, I and others argued in Committee and on Report that the drafting of Clauses 3 and 5 of the Bill is ambiguous, inadequate in terms of whatever the purpose may be, and therefore defective. The amendments to which I now speak, which are Amendments Nos. 9, 11, 12 and 13, attempt to improve the drafting of Clause 3. Indeed, if accepted, they would do so. We shall come to Clause 5 later.

At Report stage I incurred the irritation of some of your Lordships by refusing to name the legal draftsman who had been advising me. In order to get around that problem, I have since taken an official private legal opinion, which confirms the opinion that I had been given unofficially before our last proceedings. I feel that this opinion carries such weight that I should put it on record in your Lordships' House, and, indeed, I am at liberty to do so. It comes from Mr. Joe Durkin, who is the senior partner of the well known parliamentary agents, Rees & Freres. His letter to me, dated yesterday, reads as follows: Dear Lord Pearson, I refer to our discussions concerning the Bill. I can confirm that I and my partners, Peter Lane and Monica Peto, were previously members of the Office of the Parliamentary Counsel and we have considered the Bill and clauses 3 and 5 in particular and the relevant articles of the Treaty. We have also read the reports of the debates on the amendments moved by you at the Committee stage on 30 June 1993 (Hansard, cols. 842 to 847) and at the Report stage on 13 July 1993 (Hansard, cols. 130 to 136 and 144 to 150). In our view clause 3 is ambiguous in that it is uncertain whether the Order or the Annual Report is to be approved by a resolution of each House of Parliament. Furthermore, if it is the Report which is to be approved, the clause fails to say what should happen if either House refuses to approve it. The amendment (number 23) proposed by you at the Report stage would have cured both those defects. Your amendment number 20 would have further improved the clause by ensuring that the Order should be a statutory instrument which would need to be published and made publicly available in accordance with the Statutory Instruments Act 1946. Clause 5 of the Bill is also unsatisfactory in that it fails to require the government to obtain parliamentary approval to the government report before making any submission to the Council and to the Commission. Your amendments numbers 26 and 28 would bring clarity to the clause. Finally, I would advise that your amendments to clauses 3 and 5 are not only desirable but also necessary. It seems surprising, therefore, that the government intends that the Bill should proceed to Royal Assent without agreeing that those amendments be made. The only conclusion to be reached is that the government wishes to avoid Commons' Consideration of Lords' amendments even at the price of having a defective Act of Parliament. Yours sincerely, Joe Durkin". That is the end of the letter, but I hope that it is not the end of the matter.

The amendment would ensure that the order envisaged in Clause 3 is a statutory instrument; that it, and not the governor's annual report, would be subject to an affirmative resolution; and that the statutory instrument should of course contain matters which ought to be covered by the report. All reputable legal advice seems to accept that that should be the meaning of Clause 3. Can my noble friend on the Front Bench agree?

6.30 p.m.

Lord Peston

My Lords, I spoke to this amendment when the noble Lord, Lord Pearson, raised it the last time. I said robustly, and I repeat, that the amendment is clear. I assume that the Government will bring to both Houses of Parliament an annual repot from the Governor of the Bank of England with wording such as, "That this House do take note", and so forth. There seems to be no difficulty over that. I said that on the previous occasion.

I am advised also that the amendment was looked at by government draftsmen. It is not just a matter of saying that it is amateur opposition drafting. Perhaps the Minister will say a word about that. My difficulty—this is why I am indebted to the noble Lord, Lord Pearson of Rannoch—is that the three people to whom he referred are known to me, as is their firm. Peter Lane is an old friend. He is a distinguished draftsman, as are Monica Peto and Joe Durkin. The noble Lord is right to draw your Lordships' attention to their judgment. I am in difficulties because it seems to me that the Bill is clear, but as a person who lives in a professional world I am always worried when a professional tells me that it is not.

Having said that, I stick to my view that the clause is clear and is not a problem. I suppose that I can also then hide my head under the pillow and say that it is up to the Minister to argue on those grounds, as he is the one who is responsible for the Bill. I shall do that. I shall rush off to my pillow and put my head under it.

Lord Harmar-Nicholls

My Lords, I interpret the noble Lord as saying that the amendment is right, and that there are good reasons to, justify it. He gave priority to the authority quoted by my noble friend and put it ahead of his own. That is humble and good of him. When he reads his speech tomorrow, he will see that he was saying in effect that it would be a good idea if the amendment were accepted.

Lord Peston

My Lords, I am not sure whether I am breaking the rules of the House, but before the noble Lord sits down, I was not trying to say that. I was trying to say that the noble Lord, Lord Pearson, introduced his amendments because he felt that the Bill was ambiguous. I said that I do not find the Bill ambiguous but that I am worried when someone quotes a professional opinion that says that it is. That is my position. I am not saying that the noble Lord is right. I am merely saying that I am always worried when a professional opinion is quoted against me.

Lord Harmar-Nicholls

My Lords, the noble Lord, Lord Peston, is one of our leading economists. He has earned a great reputation. We respect him greatly. When economists have a division of opinion on a matter like this, they are usually dogmatic. The absence of dogmatism in what the noble Lord said gives me a clear message that he cannot find a great deal wrong with the amendment. Nor can I.

I am rather surprised that my noble friends did not accept the amendment when we dealt with it in Committee. That would have been the time to do so. We know why they did not. I hope that it will be a warning to future governments never to make a decision that they do not want any amendment to go back to the Commons from the Lords. It is clear that the instructions given by the other place, and from the top of the Government, I suppose, were that they wanted no amendment to come back from the Lords. They wanted a clear Bill. They wanted it sent back as it was. That is commendable. It is obtaining something that one wants in an easy way. The noble Lord confirmed that in the interests of proper parliamentary procedure it would have been a good thing had the amendment been accepted earlier.

I hope that the amendment will not be pushed to the vote now and take up any more time. I hope that the message will be taken back. The Government should never decide that they want no amendments from this House because it is part of our duty to send back amendments when an incomplete Bill is sent to us.

Lord Elton

My Lords, as my noble friend Lord Harmar-Nicholls has taken the opportunity to interpret freely the speech of the noble Lord, Lord Peston, I think that I should apply the same process to him and say that he will realise that the essence of the noble Lord's message was that on no account should the amendment be pressed or carried because it would be a disaster if it were.

Lord Stoddart of Swindon

My Lords, my noble friend Lord Peston seems to have a touching faith in parliamentary draftsmen. Perhaps I may remind him of the Financial Services Bill where hundreds and hundreds of amendments were made in this House. Our noble friend had to instruct the Government and the draftsmen how the Bill should be drafted. Coming more up to date, does my noble friend recall that the Government tabled hundreds of amendments to the Education Bill, which initially was so badly drafted that the government draftsmen had to burn the midnight oil and propose hundreds of amendments because they were wrong in the first place? Do not the Government think that on this occasion their parliamentary draftsmen are wrong and that my noble friend Lord Pearson and his advisers are right?

Lord Monson

My Lords, we are a revising Chamber, as we constantly remind ourselves. We fail in our duty, therefore, if, on noticing or having drawn to our attention that a Bill is grammatically defective, ambiguous, or both, we do not insist on rectifying it so that it means what the Government have always intended it to mean. I support the amendment.

The Lord Advocate (Lord Rodger of Earlsferry)

My Lords, this is the third time we have considered this matter. I fear that I have to repeat some of the things I said on the two previous occasions. I apologise to your Lordships for that. Nonetheless, it is necessary. I start with a simple proposition: one has, first, to decide what effect one thinks that the draftsman of this clause intended to produce.

My noble friend Lord Pearson of Rannoch seems to think that what was desired was that a clause should be produced which should stipulate that an order should be drawn up making provision for the Governor of the Bank of England to make an annual report to Parliament, and that that order should not be made unless it is approved by a resolution of each House of Parliament, but after that order has been made there is no question of any approval of the annual report of the Governor of the Bank of England being given.

If one starts from that position, I can see that one would decide that the wording of Clause 3, as it stands, does not lead one to that conclusion. If, however, that was not the intention of the draftsman of the clause, then of course the position is different. As I said previously, it is plain that the purpose of those who introduced the clause in another place was to ensure that the report of the Governor of the Bank of England should be subject to approval by a resolution of both Houses of Parliament.

If that is the intention it follows as night follows day that the proposed amendments are entirely unacceptable. They are not mere drafting amendments; they are designed completely to change the meaning, the purpose and the effect of the clause. They would do so in a way which I find to be extraordinary, coming from my noble friend who I understand is, in broad terms, opposed to the treaty and complains that the actions of the Community are not subject to sufficient control by Parliament.

If the amendments were carried the result would be not to increase the opportunity for Parliament to look at the work of the Governor of the Bank of England but, on the contrary, would reduce it. There would be no question of approval being required of the annual report of the Governor of the Bank of England. From the point of view of my noble friend's policy objectives I find that approach absolutely extraordinary and I cannot understand it.

One must look at the letter from Mr. Durkin in that light. I do not know exactly what was said to Mr. Durkin, but if he were being asked whether Clause 3 seemed not to give effect to the kind of policy which my noble friend wished he would plainly have come to the view that it was ambiguous at the very least. But if, on the other hand, one believes that the policy is that which I have outlined, one does not need to be a lawyer or anything other than a person capable of reading the English language in a normal way to be able to conclude that the effect of the words in the clause is to enshrine the policy which I have outlined. Clause 3 states: Her Majesty's Government shall, by order, make provision for the Governor of the Bank of England to make an annual report to Parliament". There is then the qualifying clause: which shall be subject to approval by a Resolution of each House of Parliament". If during my school days someone had asked me which noun was qualified by the adjectival clause, which shall be subject to approval by a Resolution of each House of Parlaiment", I should have had little difficulty in concluding, according to the ordinary usage of the English language, that "which" referred to the nearest relevant noun; that would have been the annual report. One reads that according to the ordinary rules of English usage—

Lord Peston

My Lords, perhaps I may interrupt the noble and learned Lord before he sits down. That is exactly my interpretation as a layman. However, is the noble and learned Lord the Lord Advocate saying that that is his interpretation, first, as a layman and, secondly, as a distinguished lawyer? It is the latter question which has been troubling me because I have had no difficulty in reading the English language.

Lord Rodger of Earlsferry

My Lords, lawyers have no language to work with apart from the English language. If it is plain what the English language says of course that is the interpretation which the courts would be expected to follow. If I have to put on my lawyer's hat, I say that where the policy intention is plain and easily derived from the wording of the clause, if interpreted according to the ordinary cannons of English, that is the way in which I should expect a court to interpret it.

Even supposing that I were wrong in the simple approach that I have advocated towards the interpretation of the clause or that somehow a judge took the perverse view that the word "which" could suddenly leap two lines up the page and attach itself to the word "order"—supposing that he were tempted to such an extraordinary construction of the English language—at that stage he might declare an ambiguity. As I have said on repeated occasions, if that situation arose the judge, under the rule recently established by your Lordships' House in its Judicial Committee in the case of Pepper v. Hart, would have regard to what was said in this House and in the other place as to the intention behind the clause and would interpret the wording of the clause in that spirit.

I have no experience in drafting legislation but I have considerable experience in interpreting legislation. I am aware that parliamentary draftsmen do not always get things absolutely correct. But I am satisfied that, in looking at the clause as I have put it to your Lordships, it embodies to a sufficient and satisfactory degree the policy which I understand to lie behind it. In that situation it would he interpreted in the spirit and with the result that I have mentioned.

I do not take up time with the point mentioned in the letter—that is, the fact that the clause does not state what would happen if there were no approval of the governor's report—for the simple reason that on two previous occasions the Governor of the Bank, at this stage ex hypothesi being an independent governor of an independent bank, would determine what to do. It would not be in accordance with the treaty for Parliament to seek to dictate to him what to do. For that reason the clause does not contain any such provision and it would be a matter for the governor to consider what to do in those circumstances.

For those reasons, which are not mere matters of drafting because they amount to an assault upon the policy behind the clause, I find the amendments completely unacceptable and I ask my noble friend not to press them.

Lord Stewartby

My Lords, before my noble and learned friend sits down perhaps I may ask him about his interpretation, in the light of his comments, which seems to me to be entirely in accordance with the wording of the clause as one would normally read it. Does it mean that the annual report to Parliament could be subject only to a Motion for approval and not to a Motion to take note, even if that seemed to be more appropriate at the time?

Lord Rodger of Earlsferry

My Lords, the terms in accordance with the clause are that it should be subject to approval. That is the way in which, at the end of the day, it would have to be framed.

Lord Jay

My Lords, even if everything that the noble and learned Lord said is true, would not all doubt be removed if the word "report" were to be inserted after the word "which"? That would put the matter beyond doubt. That there is doubt has been proved by the fact that we have had two debates on the issue. Why not make the matter clear beyond any question?

Lord Rodger of Earlsferry

My Lords, with the leave of the House, that point is raised in amendments with which we have yet to deal and I may address it in that context.

Lord Pearson of Rannoch

My Lords, I am grateful to my noble friend. I wish to remove any suggestion that he may have advanced that Mr. Durkin and the firm of Rees & Freres were in any way led to the conclusion that they reached. I have quoted their letter in full. Any noble Lord who cares to read it in Hansard will see that they have made it clear that their opinion is entirely objective, based simply on the meaning of the Bill, the treaty and the amendments.

I have to tell my noble and learned friend that he still has not really convinced me that his interpretation of the clause is correct. I say that because we are still left with the words "subject" and "report". In other words, the statutory instrument as we maintain it ought to be is still, subject to approval by a Resolution of each House of Parliament". Why would it be subject to that approval unless something was going to happen either way if that approval was not given? That phrase leads me and my legal advisers towards the interpretation that we have taken. However, I am clear that my noble and learned friend does not want to give any more on the subject at present. Therefore, for the moment, I am prepared to withdraw Amendment No. 9.

Amendment, by leave, withdrawn.

Lord Morris moved Amendment No 10: Page 2, line 5, after ("which") insert ("report").

The noble Lord said, My Lords, I have tabled the amendment in an attempt, yet again, to be helpful to my noble and learned friend Lord Rodger of Earlsferry. As we heard during the debate on the previous amendment, he decided that the amendments tabled in the name of my noble friend Lord Pearson of Rannoch were totally unnecessary. My noble and learned friend came to precisely the same conclusion in regard to the present amendment at previous stages of the Bill. The reason why he deemed it totally unnecessary was that the wording in the Bill is quite clear. In other words, on the grounds of clarity, the amendment was unnecessary.

That is rather odd. I say that because my noble and learned friend took about 400 words to explain the clarity of the Bill's wording. He also suggested that the clause might even come to court. He said that in such a situation one would have to have regard to the rule of construction in Pepper v. Hart. Indeed, my noble friend Lady Carnegy of Lour, who, as the House knows, is no slouch in the interpretation of statutes, was absolutely convinced that Clause 3 meant that it was the order that should be subject to approval and not the report.

I have re-tabled the amendment and included the word "report" so as to make the matter clear beyond peradventure and to test the opinion of the House. I have not done so because I want the Government to be defeated; indeed, I really want them to win. I have done so to make absolutely sure that they demonstrate that they really feel that the inclusion of the word "report" is unnecessary. I beg to move.

Lord Beloff

My Lords, I hope that the Government will accept the amendment. It was not only my noble friend Lady Carnegy of Lour but also a very distinguished Member of the Opposition Front Bench—namely, the noble Lord, Lord McIntosh of Haringey—who came to precisely the opposite conclusion as to the meaning of the clause to that given later by my noble and learned friend the Lord Advocate.

I could quite understand until yesterday why the Government were so keen that there should be no amendments, even of a drafting kind. It was because they were anxious to save the time of the other place by not requiring it to consider any amendments from this House. But surely that argument has now disappeared, thanks to the dissent as a sort of deus ex machina of the noble Lord, Lord Rees-Mogg, who has saved the Government from such embarrassment by giving them, probably, several weeks or, possibly, several months during which time any amendments can conveniently be discussed by the other place without the necessity of calling those concerned back from their well-earned holidays.

I believe that at this point it would be only reasonable for my noble and learned friend the Lord Advocate to admit that distinguished Members of this House have come to an entirely different interpretation to the one upon which, rightly or wrongly, he insists. He should therefore accept the amendment which will put his interpretation on the face of the Bill.

Lord Harmar-Nicholls

My Lords, I am pretty certain that my noble and learned friend on the Front Bench will not accept the amendment. He will not accept it for the very clear reason that the Government have made up their minds that, so long as they have a whipped vote, they do not want any amendment which will entail the Bill returning to another place. However, so that we can be really grown up about it, perhaps my noble and learned friend will think back to the speech he made only a few moments ago where, in order to justify his resistance to the previous amendment, he said that anyone reading English can see that "subject to approval" must refer to the order, mention of which is made two sentences previously.

The present amendment would put the matter beyond any doubt by the insertion of the word "report". Therefore, in order to justify his own defence as regards the last amendment, it would be more forceful if my noble and learned friend said that, although he can find it in his heart to say that he sees the sense of this particular amendment, he cannot accept it for bigger reasons.

Lord Rodger of Earlsferry

My Lords, I have already explained my interpretation of the clause. However, in view of the remarks just made by my noble friend Lord Harmar-Nicholls, I should stress that certainly my understanding of what I said—and, indeed, what I hoped I had said—was that the words, which shall be subject to approval", according to all the most ordinary rules of construction of the English language, refer back to the immediately preceding relevant words "annual report". I was simply saying that if, contrary to that—which I perceive to be the most obvious interpretation—a judge somehow or other could be persuaded that it might be possible to go back to the words "by order" and to attach them to the relative clause which will be "subject" and so on to the word "order", then what has been said in this House and in another place would make the correct interpretation of the clause clear. In other words, what was intended by Parliament would be clear.

I referred to the courts. I have done so only because it seems to me that that is the ultimate test which must be applied. I have indicated what the Government understand to be the intention behind the clause. Accordingly, it would be the way in which the Government would operate the clause. However, if another government chose to try to resist such an interpretation of the clause, I suppose that, at that stage, someone might choose to take the matter to court in order to make the Government submit the report for approval by Parliament. I do not know. But, if they did so, all I am saying is that, when the matter came to be tested in a contest of litigation, I am satisfied that the interpretation that I have put forward would be the one, for the reasons that I have given, which would be adopted by the court.

For that reason, I say that the amendment is unnecessary. It is because it is unnecessary that I say to noble Lords that such a change does not need to be made and, indeed, should not be made at this stage of the Bill's proceedings.

Lord Pearson of Rannoch

My Lords, my noble and learned friend has said that by the time the clause comes into force the Governor of the Bank of England will be independent and will be able to do what he likes with any report. Therefore, why should it be subject to the approval of Parliament, or otherwise?

Lord Rodger of Earlsferry

My Lords, as I said on the previous occasion, it is clearly a matter where Parliament—that is, if the clause is eventually passed into an Act—has decided that one way of dealing with the situation of an independent governor is to have an annual report which shall be subject to approval. In that way, Parliament will be able to express its will on the governor's report, whether or not it approves it. As I said, it will thereby be indicating its view of the governor's report. That is something which, obviously, the governor would be expected to take into account, although to what extent and in what way he would do so I cannot say or predict. But, in the ordinary common sense of the thing, one would imagine that the Governor of the Bank of England would, indeed, take note of whether or not Parliament had approved of the report.

In that way Parliament would be expressing a view. I think that is the intention behind this clause. It is clearly an understandable intention, and I see that as being perfectly understandable and not pointing, as my noble friend suggests, somehow or other to a construction of the words which would, in my submission, be quite contrary to all the ordinary rules of English usage and grammar.

Lord Morris

My Lords, I listened with very great care to my noble and learned friend. He suggested in his answer that this is not the right stage to move an amendment of this kind. I am certain my noble and learned friend knows as well as I do that the Companion to the Standing Orders makes it quite clear that these are precisely the type of amendments at Third Reading—mainly drafting amendments—that cart and indeed should be moved if a Bill is imperfect. What I find sad and worrying is that if this Government are so careless about what might be regarded as small matters, how careful are they about the issues which really matter? That is what worries me. I believe we should test the will of the House on this amendment.

7.1 p.m.

On Question, Whether the said amendment (No. 10) shall be agreed to?

Their Lordships divided: Contents, 33; Not-Contents, 164.

Division No. 1
CONTENTS
Belhaven and Stenton, L.	Listowel, E.
Beloff, L.	Masham of Ilton, B.
Blease, L.	Monson, L.
Bruce of Donington, L.	Moran, L.
Cross, V.	Morris, L. [Teller.]
Dacre of Glanton, L.	Onslow, E.
Dormand of Easington, L.	Pitt of Hampstead, L.
Erroll, E.	Rankeillour, L.
Glenamara, L.	Rees-Mogg, L.
Gray, L.	Stoddart of Swindon, L.
Greenway, L.	Sudeley, L.
Hamilton of Dalzell, L.	Swinfen, L.
Harris of High Cross, L.	Tebbit, L.
Jay, L.	Tonypandy, V.
Jeger, B.	Wedgwood, L.
Jenkins of Putney, L.	Willoughby de Broke, L. [Teller.]
Kilbracken, L.

NON-CONTENTS
Airedale, L.	Beaumont of Whitley, L
Aldington, L.	Belstead, L.
Allenby of Megiddo, V.	Birdwood, L.
Arran, E.	Blatch, B.
Astor, V.	Blyth, L.
Astor of Hever, L.	Bolton, L.
Auckland, L.	Bonham-Carter, L.

Borthwick, L.	Lockwood, B.
Boyd-Carpenter, L.	Long, V.
Brabazon of Tara, L.	Lyell, L.
Brougham and Vaux, L.	McAlpine of West Green, L.
Butterfield, L.	Mclntosh of Haringey, L.
Cadman, L.	Mackay of Ardbrecknish, L.
Caithness, E.	Mackay of Clashfern, L. [Lord Chancellor.]
Caldecote, V.
Carlisle of Bucklow, L.	Mackie of Benshie, L.
Carmichael of Kelvingrove, L.	Macleod of Borve, B.
Carnegy of Lour, B.	Mancroft, L.
Carnock, L.	Marlesford, L.
Carter, L.	Mayhew, L.
Chalker of Wallasey, B.	Mersey, V.
Clinton-Davis, L.	Meston, L.
Colnbrook, L.	Milverton, L
Colwyn, L.	Monk Bretton, L.
Craigavon, V.	Morris of Castle Morris, L.
Cranborne, V.	Mottistone, L.
Cranbrook, E.	Mountevans, L.
Crawshaw, L.	Mowbray and Stourton, L.
Crickhowell, L.	Moyne, L.
Cumberlege, B.	Mulley, L.
Darcy (de Knayth), B.	Murton of Lindisfarne, L.
De L'Isle, V.	Nelson, E.
Dean of Beswick, L.	Nicol, B.
Denham, L.	Orkney, E.
Denton of Wakefield, B.	Orr-Ewing, L
Dilhorne, V.	Oxfuird, V.
Elibank, L.	Park of Monmouth, B.
Elles, B.	Pender, L.
Elliot of Harwood, B.	Perry of Walton, L.
Elphinstone, L.	Peston, L.
Elton, L.	Peyton of Yeovil, L.
Ezra, L.	Prentice, L.
Fairfax of Cameron, L.	Reay, L.
Ferrers, E.	Redesdale, L.
Fraser of Carmyllie, L.	Renfrew of Kaimsthorn. L.
Fraser of Kilmorack, L.	Renwick, L.
Gilmour of Craigmillar, L.	Rippon of Hexham, L.
Glenarthur, L.	Rodger of Earlsferry, L.
Goschen, V.	Rodgers of Quarry Bank, L
Graham of Edmonton, L.	Rodney, L.
Gregson, L.	Russell, E.
Grey, E.	St. Davids, V.
Gridley, L.	Saltoun of Abernethy, Ly.
Hacking, L.	Sanderson of Bowden, L.
Hailsham of Saint Marylebone, L.	Seccombe, B.
	Seear, B.
Harmsworth, L.	Sharples, B.
Harris of Greenwich, L.	Sherfield, L.
Hayhoe, L.	Shuttleworth, L.
Hayter, L.	Simon of Glaisdale, L.
Henley, L.	Skidelsky, L.
Hesketh, L. [Teller.]	Stodart of Leaston, L.
Hilton of Eggardon, B.	Strathclyde, L.
Hives, L.	Strathcona and Mount Royal, L.
Holderness, L.
Hood, V.	Strathmore and Kinghorne, E. [Teller.]
Hooper, B.
Hooson, L.	Taylor of Blackburn, L.
Houghton of Sowerby, L.	Taylor of Gryfe, L.
Howe, E.	Thomas of Gwydir, L.
Hylton-Foster, B.	Thomas of Swynnerton, L.
Inchyra, L.	Thomson of Monifieth, L.
Inglewood, L.	Thurlow, L.
Jeffreys, L.	Tordoff, L.
Jenkins of Hillhead, L.	Trumpington, B.
Judd, L.	Ullswater, V.
Kilmarnock, L.	Vivian, L.
Kimball, L.	Wakeham, L. [Lord Privy Seal.]
Kinloss, Ly.
Kinnoull, E.	Warnock, B.
Knutsford, V.	Waverley, V.
Lauderdale, E.	Wharton, B.
Leigh, L.	White, B.
Lindsay, E.	Wynford, L.
Lindsey and Abingdon, E.

Resolved in the negative, and amendment disagreed to accordongly.

7.10 p.m.

[Amendments Nos. 11 and 12 not moved.]

Lord Pearson of Rannoch moved Amendment No. 13: Page 2, line 5, leave out from ("Parliament") to end of line 6 and insert: ("(2) No such order shall be made unless a draft of it has been laid before, and approved by a resolution of, each House of Parliament.").

The noble Lord said: My Lords, I am afraid that this is an amendment—

Noble Lords

It was grouped with Amendment No. 9.

Lord Pearson of Rannoch

My Lords, I withdrew Amendment No. 9. I spoke to Amendments Nos. 11, 12 and 13 and I indicated that I would be coming back to Amendments Nos. 11 and 12, and this is now Amendment No. 13. I believe that this is an amendment which goes in the opposite direction to what my noble and learned friend has said. I should like to test the opinion of the House on Amendment No. 13. I beg to move.

Lord Peston

My Lords, I am not clear what the noble Lord said that he had said because I did not hear him say what he said that he said.

Lord Pearson of Rannoch

My Lords, when I was speaking to Amendment No. 9 I made it clear that I was also speaking to Amendments Nos. 11, 12 and 13. After that debate I withdrew Amendment No. 9. I believe that I am now therefore in order to move Amendment No. 13, which I wish to do. I wish to test the opinion of the House on Amendment No. 13.

7.12 p m.

On Question, Whether the said amendment (No. 13) shall be agreed to?

Their Lordships divided: Contents, 31; Not-Contents, 138.

Division No. 2
CONTENTS
Belhaven and Stenton, L.	Onslow, E.
Beloff, L.	Orr-Ewing, L.
Blease, L.	Pearson of Rannoch, L. [Teller.]
Bruce of Donington, L.
Cross, V.	Perry of Walton, L.
Dacre of Glanton, L.	Pitt of Hampstead, L.
Dormand of Easington, L.	Rankeillour, L.
Galpern, L.	Rees-Mogg, L.
Gray, L.	Stoddart of Swindon, L. [Teller.]
Hamilton of Dalzell, L.
Harris of High Cross, L.	Sudeley, L.
Jay, L.	Swinfen, L.
Jenkins of Putney, L.	Tebbit, L.
Kilbracken, L.	Tonypandy, V.
Monson, L.	Wedgwood, L.
Moran, L.	Willoughby de Broke, L.
Morris, L.

NOT-CONTENTS
Airedale, L.	Blatch, B.
Aldington, L.	Blyth, L.
Allenby of Megiddo, V.	Boyd-Carpenter, L.
Arran, E.	Brabazon of Tara, L.
Astor, V.	Braine of Wheatley, L.
Astor of Hever, L.	Brougham and Vaux, L.
Auckland, L.	Cadman, L.
Belstead, L.	Caithness, E.

Caldecote, V.	Mackay of Ardbrecknish, L.
Carlisle of Bucklow, L.	Mackay of Clashfern, L. [Lord Chancellor.]
Carnegy of Lour, B.
Carnock, L.	Macleod of Borve, B.
Carter, L.	McNair, L.
Chalker of Wallasey, B.	Mancroft, L.
Clinton-Davis, L.	Marlesford, L.
Colnbrook, L.	Mersey, V.
Colwyn, L.	Milverton, L.
Craigavon, V.	Monk Bretton, L.
Cranbrook, E.	Morris of Castle Morris, L.
Cumberlege, B.	Mottistone, L.
De L'Isle, V.	Mountevans, L.
Dean of Beswick, L.	Mowbray and Stourton, L.
Denham, L.	Moyne, L.
Denton of Wakefield, B.	Mulley, L.
Dilhorne, V.	Murton of Lindisfarne, L.
Elibank, L.	Nelson, E.
Elles, B.	Nicol, B.
Elliot of Harwood, B.	Orkney, E.
Elphinstone, L.	Oxfuird, V.
Elton, L.	Park of Monmouth, B.
Fairfax of Cameron, L.	Pender, L.
Faithfull, B.	Peston, L.
Ferrers, E.	Peyton of Yeovil, L.
Fraser of Carmyllie, L.	Prentice, L.
Fraser of Kilmorack, L.	Reay, L.
Gilmour of Craigmillar, L.	Redesdale, L.
Goschen, V.	Renfrew of Kaimsthorn, L.
Graham of Edmonton, L.	Renwick, L.
Grey, E.	Richard, L.
Gridley, L.	Rippon of Hexham, L.
Hacking, L.	Rodger of Earlsferry, L.
Hailsham of Saint Marylebone, L.	Rodney, L
	St. Davids, V.
Harmsworth, L.	Saltoun of Abernethy, Ly.
Hayhoe, L.	Sanderson of Bowden, L.
Hayter, L.	Seccombe, B.
Henley, L.	Sharples, B.
Hesketh, L. [Teller.]	Sherfield, L.
Hilton of Eggardon, B.	Shuttleworth, L.
Hives, L.	Simon of Glaisdale, L.
Holderness, L.	Slynn of Hadley, L.
Hood, V.	Stodart of Leaston, L.
Hooper, B.	Strathclyde, L.
Houghton of Sowerby, L.	Strathcona and Mount Royal, L.
Howe, E.
Hylton-Foster, B.	Strathmore and Kinghorne, E [Teller.]
Inchyra, L.
Inglewood, L.	Taylor of Blackburn, L.
Jeffreys, L.	Taylor of Gryfe, L.
Jenkin of Roding, L.	Thomas of Gwydir, L.
Kilmarnock, L.	Thomas of Swynnerton, L.
Kimball, L.	Thurlow, L.
Knutsford, V.	Trumpington, B.
Lauderdale, E.	Ullswater, V.
Leigh, L.	Vivian, L.
Lindsay, E.	Wakeham, L. [Lord Privy Seal.]
Lindsey and Abingdon, E.
Listowel, E.	Warnock, B.
Lockwood, B.	Waverley, V.
Long, V.	White, B.
Lyell, L.	Wynford, L.
McIntosh of Haringey, L.

Resolved in the negative, and amendment disagreed to accordingly.

7.20 p.m.

Clause 5 [Convergence criteria: assessment of deficits]:

[Amendment No. 14 not moved.]

Lord Morris moved Amendment No. 15: Page 2, line 18, leave out ("report").

The noble Lord said: My Lords, your Lordships will recall that in moving Amendment No. 10 we were assured by my noble and learned friend the Lord Advocate that the word "report" in Clause 3 was totally unnecessary because the meaning was absolutely clear. Clause 3 called for two things: first, that Her Majesty's Government should make an order; and, secondly, that they should make an annual report. It was for that reason that I believe the inclusion of the word "report" after "which" helps to clear up a quite obvious ambiguity.

If it was unnecessary in Clause 3, I should have thought that the inclusion of the word "report" in Clause 5 was even more unnecessary. Her Majesty's Government are keen on clarity and precision in drafting. It is for that reason that I move the amendment. Bearing in mind what my noble and learned friend said in defending the drafting of Clause 3, 1 am sure that he will happily welcome the amendment. I beg to move.

Lord Rodger of Earlsferry

My Lords, I fear that I may disappoint my noble friend by not agreeing to his amendment. I do not accept any implied suggestion that the word "report" is somehow redundant in Clause 5 if I state that it is unnecessary in Clause 3. I have explained to your Lordships how I believe that one would naturally interpret Clause 3 according to the ordinary rules of English. However, if one considers Clause 5, it is a very different clause in this sense. It states that, Her Majesty's Government shall report to Parliament for its approval an assessment of"— the clause sets out various items, and continues— which report shall form the basis of any submission to the Council and Commission". If one were to follow the spirit of the amendment and withdraw the word "report", it would not make the clause clearer. It would have the effect of making it less clear. I understand that to be precisely the reverse of what my noble friend intends.

The word "report" added after "which" is one way of making clear to what the word "which" refers. That might be doubtful in Clause 5 in which there is a great string of nouns just before the word "which". It might therefore be somewhat doubtful to which word "which" refers. To make sense, if the word "report" was not in, Clause 5 "which" would have to refer back to the word "assessment" at the beginning of line 16. According to the ordinary rules of English usage, I believe that the use of the word "which" to refer back to two lines above would be unnatural. I therefore do not find it surprising that the draftsman of Clause 5 has inserted the word "report" to make it clear that it is the assessment which is reported which is to form the basis of the submission to the Council and the Commission.

Contrary to what is implied by my noble friend's amendment, omitting the word "report" makes the clause less clear rather than clearer. In that situation the amendment would make the Bill worse, even in drafting terms. For that reason, I ask my noble friend to withdraw the amendment.

Lord Morris

My Lords, I thank my noble and learned friend for his response to the amendment. I wish that I had had those words to use when I moved Amendment No. 10. I believe that they are a perfect justification for including the word "report" in Clause 3. It is precisely for that reason that I believe it would be an improvement to Clause 3.

However, as in all innocence we take even the most unworldly and unpromising assurances with equanimity, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Pearson of Rannoch moved Amendment No. 16: Page 2, line 20, at end insert: ("(2) No such submission shall be made unless the report referred to in subsection (1) above has been laid before and approved by both Houses of Parliament.").

The noble Lord said: My Lords, I appreciate that Amendment No. 16 is grouped with Amendment No. 14, but with the leave of your Lordships' House I should like to speak to it briefly. Some of your Lordships may have noticed that I was caught on the wrong side of the Chamber after the last vote. If I had not been, I would not have done the discourtesy of passing between the Lord Chancellor and the Table, and I would also have moved Amendment No. 14, which I appreciate is now behind us.

If it is in order, I shall speak briefly to Amendment No. 16 which would improve the drafting of Clause 5 of the Bill. I shall not repeat everything that I have just said about the poor drafting of Clause 3. Suffice it to say that Clause 5 of the Bill as we have considered it on Report and in Committee is also unsatisfactory because it fails to require the Government to obtain parliamentary approval of their report before making any submission to the Council and to the Commission. I believe that the amendment tabled, Amendment No. 16, is adequate to make good that omission. I beg to move.

Lord Rodger of Earlsiferry

My Lords, I hope that I can be as brief as my noble friend. As I explained previously, the position is that I am satisfied, and I have sought to persuade your Lordships that they should be satisfied, that the wording of the clause makes clear that what is intended is that the information should be submitted only if the report has been submitted and approved by both Houses of Parliament.

If my noble friend had moved Amendment No. 14, he would have sought to delete from the clause the words "for its approval". Those words are absolutely crucial to the argument. The clause states: Before submitting the information … Her Majesty's Government shall report to Parliament … an assessment of the medium term economic and budgetary position". If the clause simply stated that, "Her Majesty's Government shall report to Parliament an assessment", and so on, I understand that there would be some doubt about the matter. But the words of the clause do not stop there. The words "for its approval" are inserted into the clause. If my noble friend was right, and the matter did not have to be approved before it was submitted, what would be the purpose of adding the words "for its approval"? They would be entirely redundant and superfluous. There would be no point in having those words in the clause.

My noble friend's construction of the clause does not take account of the words "for its approval". It is an elementary principle of statutory construction known to all lawyers that one must have regard to all the words which are there and give them value. The point is that because Parliament will say, if this clause becomes a section of the Act, it is to be reported to Parliament for its approval, the implication must necessarily be that it is only to be submitted if that approval has been maintained.

Again, at pains of labouring the same point, even if I am wrong on that matter and the matter remained dubious, doubtful or ambiguous, the court would have regard to what has been said repeatedly about the matter both in another place and in your Lordships' House as to the interpretation which is to be put on those words. Account will be taken of that, and I am satisfied that the construction which I have advanced and which I understand is accepted as being the desired construction by my noble friend Lord Pearson will indeed be the construction that is put upon the clause. Therefore, I ask my noble friend to withdraw the amendment.

7.30 p.m.

Lord Pearson of Rannoch

My Lords, I am most grateful to my noble and learned friend. I have to say that the fact that he comes to rely on Pepper v. Hart on this clause as well as on Clause 3 leads me to the conclusion that the clauses are badly drafted. However, I see no point in pursuing the matter further at the moment. It is clear that the Government are content to see a Bill receive Royal Assent even if it is defective. In those circumstances, I feel that I have no alternative but to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 17 not moved.]

Lord Morris moved Amendment No. 18: After Clause 6, insert the following new clause:

Frontier protection

(". Nothing in this Act shall have the effect of requiring the abandonment or restriction of any measures in force at the periphery of the territory of the United Kingdom for—

1. (a) the purpose of control of drug traffic, terrorism and other criminal activity, and
2. (b) the passage to and from the United Kingdom of persons who are not citizens of the Union.").

The noble Lord said: This amendment was discussed at the previous stage of the Bill. I sought reassurance from my noble friend Lord Ferrers because, although I was greatly reassured by him, which is why I withdrew the amendment—and I listened with great care to what he said—I read a report that a Signor Raniero Vanni d'Archirafi, who, I assume, is an Italian commissioner for the internal market, gave warning that Britain would not long escape Brussels programme for a border-free European Community.

In fairness, the report goes on to state that British officials reported that they had "objections of substance" to removing border checks against drug smugglers, terrorists and illegal immigrants. That is precisely my understanding as to what is the position of Her Majesty's Government. I should very much like to know from my noble friend whether Her Majesty's Government have made any démarches, or whatever the term may be, to the Commission to object to a commissioner making such a statement which basically ignores the much publicised position of Her Majesty's Government. I beg to move.

Lord Hacking

My Lords, I rise with some disappointment. As my noble friend indicated, on Report he moved an amendment in identical terms. I thought that I had provided comfort to my noble friend on Report because I told him that adequate provision for the matters about which he is anxious is contained in the Treaty of Rome.

Perhaps I may deal with the matter with a little more precision. If my noble friend looks at Article 36, which concerns the free movement of goods, and Article 48, which concerns the free movement of persons, he will find that member states are able to set up border controls to deal with matters of public policy or public security. If my noble friend needs further comfort—I am happy to provide it—your Lordships have considered this matter in considerable detail in a European Communities Select Committee report; namely, the 1992 Border Control of People report. Your Lordships concluded in that report that the Single European Act does not impose a legal obligation to abolish national border controls and that member states are required to co-operate with regard to immigration from outside the Community and in combating crime.

At a later stage of the report we considered specifically frontier checks for illegal weapons, checks for illegal drugs, systematic passport control, checks for prevention of terrorism, and checks for ordinary civil and criminal law enforcement. In each of those circumstances your Lordships' Select Committee found that border controls were lawful under European law and were appropriate.

Therefore, I hope that my noble friend, who also had the benefit of the comfort given to him by my noble and learned friend Lord Ferrers on Report—whatever that Italian commissioner said—may receive comfort from us now.

Earl Ferrers

My Lords, I shall be only too pleased to give such comfort as I can, even though I am not in the elevated position of being a learned friend, as my noble friend Lord Hacking described me.

My noble friend Lord Morris is, of course, and always has been, very worried about frontier controls and our ability to keep them. I can understand that, and I shall try to do my best to allay his fears.

As my noble friend Lord Hacking said, the amendment which has been tabled is precisely the same as one which he put down at Report stage. After I had given the Government's views, on that amendment, my noble friend was generous enough to say that rarely had he received an answer so close to the one which he sought. I felt deeply flattered. My ego immediately shot up two points on the Richter scale, only to collapse again totally to zero when I saw tabled at Third Reading the same amendment as that on which I had given my noble friend such complete satisfaction. I shall struggle once again up the hill to see if I can achieve a "double whammy" and satisfy my noble friend for the second time.

We do not accept the European Commission's interpretation of Article 8A of the Treaty of Rome in relation to the free movement of persons within the European Community. We have always maintained that the right of free movement guaranteed by the Treaty of Rome applies only to European Community nationals. We therefore have no intention whatever of abandoning frontier checks on people at our internal frontiers with other member states, including the continuation of immigration controls on all non-European Community nationals who want to come to the United Kingdom.

The declaration, which was agreed in 1985 by the European Commission and all the member states and which was attached to the Single European Act, made it perfectly clear that there is nothing in the Single European Act which affects the right of member states to take such measures as they consider necessary for the purpose of controlling immigration from third countries and of combating terrorism, crime and drug trafficking.

Neither the Maastricht Treaty nor the Bill before your Lordships today alter the position on the maintenance of our frontier controls. The treaty simply confirms the existing rights of residence and free movement which European Community nationals already enjoy. The only change is that, once the treaty is in force, Article 8A of the Treaty of Rome will be renumbered to become Article 7A. This, I think your Lordships will agree, is not a matter of the most profound constitutional importance.

My noble friend asked about the démarches on frontier controls. Government Ministers have made their position on frontier controls absolutely clear to other member states and the Commission. My noble friend referred also to what the Belgian Foreign Minister said. It is worth making it clear to my noble friend that Belgium is a member of the Schengen group of countries which comprises nine member states; that is, all the member states of the European Community other than Denmark, Ireland and the United Kingdom. The Schengen Convention was designed to lead to the complete abolition of frontier checks between its signatories. It is of course a matter for the Belgian Government to set out their presidency programme. The United Kingdom does not share that objective; we have no intention of joining Schengen. The Government have repeatedly made it clear that Article 8a does not apply to third country nationals and that they intend to maintain full immigration controls on third country nationals, together with such checks as are necessary on European Community nationals, so as to ensure that immigration control is not evaded or undermined.

The United Kingdom does not believe that such checks in any way hinder the free movement of Community nationals in the exercise of their right to move freely within the territories of the member states. There is, I think, increasing recognition within the Community of the need to counter illegal immigration and cross-frontier crime. In France, for example, the new government are taking tough measures to deal with these sorts of problems. In the United Kingdom the most effective way of dealing with illegal immigration and cross-frontier crime is to retain controls at our frontiers. This we intend to do.

Lord Morris

My Lords, yet again I must thank my noble friend for responding to the amendment in such detail. Perhaps I may first say to the noble Lord, Lord Hacking, that I am extremely touched that he should be so concerned as to seek to reassure me, not only at Report stage but again today as well. I do not seek any reassurance, or indeed assurance, from him. But what he said did not reassure me at all.

I am sure that my noble friend on the Front Bench will understand why I proposed the amendment. I am extremely sorry to have inconvenienced him. But reports such as that to which I referred do concern people. I hope that Her Majesty's Government continue to tell commissioners of other countries, whether they be of the Schengen group or not, that when they make remarks such as, "Britain would not long escape the Brussels programme for a border-free EC", then, frankly, they should get lost. I hope he continues so to do. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 7 [Commencement (Protocol of Social Policy)]:

Lord Tebbit moved Amendment No. 19: Page 2, line 25, leave out ("each") and insert ("either").

The noble Lord said: My Lords, this is a very simple and straightforward amendment. I may say that I was deeply hurt in one of our earlier debates when my noble friend Lady Chalker accused me of wrecking tactics when I was attempting to help the Government by moving that Clause 7 should not stand part of the Bill.

As noble Lords will recollect, Clause 7 was put into the Bill against the wishes of Her Majesty's Government. I thought that it would be an act of kindness towards my friends in Government if we could get the thing out again. I am sure that as we approach Thursday's debate, Ministers will wish devoutly that they had been able to get rid of Clause 7. I endeavoured to do so. I recollect very clearly that my proposal was overwhelmingly defeated. There were, I believe, a mere 16 of us who supported the Government's policy; and the Government's supporters were whipped to oppose the Government's policy. These are the tragic ironies of this sort of treaty and this sort of Bill. Perhaps I was too ambitious in seeking to help the Government to that extent. This amendment seeks to help the Government in a more modest way and, I hope, a more acceptable way.

Noble Lords will see that on page 2 of the Bill, line 25 refers again to the unhappy Clause 7. At the moment it says: This Act shall come into force only when each House of Parliament has come to a Resolution on a motion tabled by a Minister of the Crown considering the question of adopting the Protocol on Social Policy". There are all sorts of hazards in that. If a Motion has been substantially amended before it is voted upon, would it still be a Motion tabled by a Minister of the Crown? There are some interesting debates and arguments there. So we do not know what sort of dreadful uncharted waters Her Majesty's Government will find themselves in at about half past ten (shall we say?) on Thursday evening.

I want to help the Government to extricate themselves so far as they can from this ghastly tar baby called the European Communities (Amendment) Bill. If I cannot accomplish that in its entirety, then I want to help to reduce their embarrassment as far as possible.

It is very unwise to speculate about the outcome of votes in either House. But it seems to me, particularly in the light of the majority against my noble friends and myself on Wednesday evening, that it is quite probable that the Government will have their way in this House on Thursday. It is just a little more problematical as to what will happen in another place. At the moment the Government are bound by the formulation that the Act, shall come into force only when each House of Parliament has come to a Resolution". It may well be that the other place will not come to a resolution, or if it does, that it will be a resolution unpalatable to Her Majesty's Government. I offer the way out. One simply removes the word "each" and substitutes "either". Then the whole thing becomes much more simple for my friends. This is a generous offer from a Euro-sceptic and an opponent of the treaty such as I. It is a way of smoothing the Government's path towards ratification. I do so because I have the feeling that perhaps some of my noble friends and my right honourable friends in the Government felt hurt in the past that I was so deeply opposed to this treaty that I would stop at almost nothing to stop the treaty. Here, I offer my noble friend a way of making life easier for the Government. I hope that she will be able to find it as easy to accept it. I beg to move.

7.45 p.m.

The Earl of Onslow

My Lords, the amendment will also, I suspect, help Her Majesty's Ministers if, on Thursday, another place decides perhaps not to agree with the First Lord of the Treasury and his team. He will perhaps then be excused from having to use the threat of signing the treaty and using the prerogative against the will of another place. I say to noble Lords on the Front Bench: please ponder a little upon it.

Baroness Chalker of Wallasey

My Lords, this does not seem to be the most popular of amendments since I am the third speaker in this small debate. Perhaps I may say to my noble friend Lord Tebbit that I long ago learnt that there was nothing simple about his offers. They were always complicated.

I remember the noble Lord speaking in an earlier debate. I believe it was on this subject. The noble Lord spoke of icebergs, how one could see only the tip and that there was so much below it. He meant it in a different context. But his Amendment No. 19 is just such an iceberg. I do not have my pick-axe with me. I will take him at face value; namely, that he put this amendment down to help Her Majesty's Government. But I have to say that I wish I thought in truth that that was what the noble Lord sought to do.

The Government fully accept that Clause 7 of the Bill was introduced in another place through an official Labour amendment. That does not make it necessarily wrong. We might have preferred that it had not happened. In fact, I think we would have preferred that. But we recognise that another place wanted the opportunity to debate again the social protocol. So this debate will now take place on Thursday in another place. I shall not go into the ins and outs of the social protocol now. I am sure that we shall have plenty of time to do that on Thursday. The original amendment only specified a resolution in the other place, but I believe that many of your Lordships would have felt left out and decidedly cross had they not been given a similar opportunity. I am glad to see the noble Lord, Lord Peston, nod his head in agreement with me.

That was the reason why the Government introduced an amendment during Report stage in another place; namely, to ensure that the requirement in Clause 7 also included your Lordships' House. We believed that it was only right and proper that both Houses should consider the matter. If I were to accept Amendment No. 19, so kindly proposed by my noble friend Lord Tebbit, and this House were to have such a debate and come to a resolution on Thursday, does he—but perhaps I should not put it like that. My noble friend cannot be in any doubt that another place would not accept your Lordships' decision on that particular matter. In fact, I do not even think that the Front Bench opposite, on behalf of their friends down the passage, would like it that this House should have formed the resolution and not another place.

The Government are confident that their Motion will be passed by both Houses of Parliament. We are confident that there is a majority in favour of the United Kingdom's opt-out from the social chapter in both Houses. It would be very tempting, even at this unusually early hour, to explain why that is so. But perhaps I shall have the chance to do so later in the week.

Should the amendment of my noble friend Lord Tebbit be agreed to, we should have a difficult situation. It could be that this House would come to the resolution that I mentioned but the other House would not come to a resolution. It could also be that we were in some grave difficulty when the other place wished to come to a resolution. So I just do not believe that this amendment is practicable.

I believe that we should leave the Bill and Clause 7 as they are, with the requirement that both Houses should come to a resolution. My noble friend Lord Tebbit was obviously kindness itself on this last specific amendment after nine days of debate—or 10 days with today's debate. However, I must ask him to think again and realise that even I can spot his icebergs some way off.

Lord Tebbit

My Lords, I am grateful for the response from my noble friend. I am particularly grateful for the implication of her words when she said that, if this amendment were to be agreed, the Government would be in some difficulty on Thursday. I am very glad to hear that they are not yet in some difficulty. I should have thought that there was every chance that they might be in some difficulty. But here, yet again, a gift horse is being looked in the mouth. I have to say to my noble friend, though I shall not pre-empt another debate which may take place, that of course the protocol, as we all know, is entirely ineffective.

My noble friend wants to go down the road to prove my point. I am deeply hurt that my gift horse should be treated in that way. But I understand her determination on the matter.

Lord McIntosh of Haringey

My Lords, is the noble Lord sure that he means gift horse?

Lord Tebbit

My Lords, perhaps I do, in a way, yes. I am deeply hurt that this very helpful proposition should have been refused in that way. But I understand how determined is my noble friend. Therefore I shall not push the matter to a Division.

Amendment, by leave, withdrawn.

Baroness Chalker of Wallasey

My Lords, I beg to move that the Bill do now pass.

Moved, That the Bill do now pass.—(Baroness Chalker of Wallasey).

7.55 p.m.

Lord Richard

My Lords, on the 10th day of our consideration of this Bill I can and will be brief. I am bound to say that I have never seen a more hazardous looking gift horse than the noble Lord, Lord Tebbit. For a gift horse his teeth are long, if I may say so. I hesitate to use the word "fangs" but my garlic is ready.

Noble Lords on all sides of the House could perhaps be forgiven for thinking that today's discussion of the European Communities (Amendment) Bill is in some way merely a distraction from Thursday's debate on adopting the social protocol. I do not wish to detract from the historic significance of Thursday's vote; nevertheless, I hope that noble Lords will recognise that today affords an important opportunity to take stock of the Maastricht process, to consider the Community's future to a certain extent and examine some of the issues which might dominate the post-Maastricht agenda.

We on these Benches believe that the passage of the Bill gives the Government an opportunity to use the occasion to signal a willingness to reconsider their overall strategic approach to Europe, which I am bound to say has lacked vision or any sense of the future development of the Community and has succeeded more often than not in relegating this country to the margins of the Community. I believe that when the Government consider the role that they intend to play in the Community's debate over the Community's post-Maastricht development they must ensure that the United Kingdom is right at the centre of that process, helping to set the agenda and influencing our partners rather than sulking on the sidelines and witnessing our position within the Community decline even further.

The Government's isolation within the Community intensified with the negotiation of an opt-out of the Social Charter and their continuing hostility to the incorporation of the protocol into United Kingdom law. It is right at this stage for me to set out clearly the Labour Party's position in relation to the passage of this Bill.

We secured in the other place a number of important amendments to the Bill. Noble Lords will know what they are. Among other things, we secured Thursday's debate. We ensured that the Committee of the Regions has elected representatives and we forced the Government to accept amendments strengthening the Bank of England's accountability to Parliament, obliging the Government to keep Parliament informed about their contribution to ECOFIN and placing them under a duty to report to the Commission on the performance of the United Kingdom economy.

However, I am afraid that the Government's exclusion of the Social Chapter, whatever happens on Thursday, makes it impossible for the Labour Party to support the Bill at this stage. Therefore, it is our intention to abstain in the event of a division taking place.

Over the weekend the Prime Minister attempted to peddle the line that business and industry hate the Social Chapter. That flies in the face of the facts. The business community and industry have long grasped that the Social Chapter is central to a successful single market in Europe as a whole. Moreover, many parts of industry and business have played a vital role in its development. Reflecting that, UNICE (the European employers' organisation, which includes our own CBI) participated fully in the Social Chapter discussion in the deal. It is interesting, too, to note that Nissan's managing director recently told the House of Commons Select Committee on Employment that the Social Chapter posed few problems for his company. Frankly, those factors make a mockery of the Government's claim that the protocol would be bad for business and would cost jobs.

I do not propose tonight to make the speech which I hope to be in a position to make to this House on Thursday. I merely say that I believe that the Government will have a golden opportunity on Thursday to spell out their position on the Social Chapter. But I suspect that the Prime Minister may well have a few sleepless nights before deciding exactly what he will say. The permutations seem almost endless.

The performance of Ministers to date hardly inspires confidence. Indeed, it is occasionally like watching two blindfolded individuals trying to tackle the Rubik Cube wearing boxing gloves. It shows the same degree of sensitivity and delicacy in approaching a problem which needs solution. I do not find it too edifying or entertaining as a spectator sport.

In the passage of the Bill through the House we had a number of excellent debates. Various noble Lords distinguished themselves by their efforts. First, I should like to pay tribute to the spirit and good humour with which the Bill was debated. In that respect I acknowledge the tenacious skill and expertise of my noble friends Lord Bruce of Donington and Lord Stoddart of Swindon. They participated fully in our debates. I am sure that everybody in the House agrees with that. They did so, if I may respectfully say so, from a position of knowledge and experience. Therefore, the House rightly listened to them with interest. I did not agree with them, but that is an entirely different matter.

On the other side of the House various noble Lords pursued the fight, as they saw it, with the same degree of tenacity. I think of the noble Lord, Lord Pearson. The noble Lord, Lord Tebbit, since his induction into the somewhat arcane procedures of this House, performed as we would expect him to—neither more nor less. He performed well up to expectations. The noble Earl, Lord Onslow, and the noble Lords, Lord Beloff and Lord Morris, among many others, made excellent contributions.

In summing up the procedures of this House, one can say that the issues in this Chamber were properly exposed and debated, unlike the consideration given to the Bill on other occasions in other places. We have gone into just about every argument that could be made for the Bill; every argument that could be made against it; some arguments which were neither for nor against; some that were unhelpful to the Government and some, like the arguments of the noble Lord, Lord Tebbit, on the last amendment, that were extraordinarily helpful in the way that he set out quite deliberately to ensure that the Prime Minister's sleepless nights were minimised and the Government could feel some confidence.

It is important to make those points at this stage of the passing of the Bill. All too often, I fear, the proceedings in your Lordships' Chamber do not receive the consideration which sometimes they deserve. I am bound to say that the passage of the Bill through your Lordships' House has been one of those occasions.

Assuming that the Bill is passed and that ratification takes place—I hope in the not-too-distant future—the Community must then face up to the challenges of the post-Maastricht agenda. The break-up of Central and Eastern Europe which is taking place before our very eyes underlines the importance of enlarging the Community in a sensible and gradual way. To prevent a general conflagration the Community must offer the states a framework in which they can develop effective democracies and viable economies. Failure to do so could replicate the carnage in Bosnia and throughout Europe.

I expect debates to develop on the implications of enlargement for the Community's budget and its institutional structure and on the future of the common agricultural policy. Those are matters in which I hope the Government will be playing an active role at the heart of Europe—to coin a phrase which we may have heard from other lips in the not-too-distant past. I hope that we shall help to set the agenda and be active in persuading the Community to face up to its difficulties.

I conclude on a slight note of warning to the Government. The Labour Party will oppose any attempt by the Prime Minister to use the legal challenge to Maastricht in the courts as an excuse for ignoring a vote by the House of Commons in favour of Britain adopting the social chapter. The Government must accept the will of Parliament. Failure to do so would put them on a dangerous course.

I remind the House of a quotation from the Prime Minister when he addressed the House of Commons in June of this year. He said that common consent in this country was exercised through a parliamentary democracy and through voices and words of Members of Parliament in that House. I can imagine that it is the earnest wish of noble Lords on all sides of the House that the Prime Minister remembers those words and acts upon them when he addresses the House of Commons on Thursday. The alternative would be to insult and demean parliamentary democracy in this country. Over the past seven or eight weeks we have heard a great deal in this House and elsewhere about the importance of parliamentary democracy. It would push the Government into a constitutional minefield which they lack the strength, character and unity to navigate.

My final words are words of thanks to the Minister, who piloted the Bill successfully through the House. She did it with knowledge, skill, determination and a degree of good humour which at times may have been a little strained but which nevertheless she managed womanfully to conceal. For that we thank her. Therefore, if it comes to a vote tonight, I regret that the Labour Party will not be in a position to support the proposition that the Bill do now Pass. For the reasons which I set out, I do not believe that we can.

8.7 p.m.

Lord Bonham-Carter

My Lords, the noble Lord, Lord Richard, made a number of points with which I agree, in particular his comments concerning the lack of leadership by the Government and a lack of vision in regard to Europe. Had those elements been present, the passage of the Bill and the ratification of the treaty would have been much easier. But I cannot go along with him that those of us who believe that the treaty should be ratified—in his words "in the not-too-distant future"—have any right whatever to abstain on this occasion. I do not know whether the abstention is whipped. But I have never heard of a horse being whipped not to start a race. It must be embarrassing for him to have to announce that decision.

Lord Richard

Not at all.

Lord Bonham-Carter

We are coming to the end of another chapter in the long volume entitled "The Treaty of Maastricht". Again, unlike the noble Lord, Lord Richard, I cannot pretend that the way in which Parliament handled the treaty increased either public understanding of it or respect for parliamentary institutions. On the contrary, endless hours spent discussing the treaty led many people to suppose that politicians were up to funny games and to suspect their motives.

In your Lordships' House we had an excellent debate on Second Reading and on the referendum. But I cannot pretend that the Committee, Report and Third Reading debates which simply covered ground that had been covered before on several occasions were altogether appropriate. I admire the determination and tenacity of the opponents of the treaty, notably those who were mentioned by the noble Lord, Lord Richard; but I cannot believe that it is in accordance with the spirit of our procedure that we should march again and again over the same ground. By now it must be so densely paced that the marks of our hooves—some of them cloven—are invisible and our repetitious debates have no impact.

Indeed, on page 111 the Companion states clearly—I know that it is not mandatory; it is only advisory— The principal purposes of amendments on Third Reading are to clarify any remaining uncertainties, to improve the drafting and to enable the Government to fulfil undertakings given at earlier stages of the Bill.

It is considered undesirable that an issue which has been fully debated and decided upon at a previous stage of a Bill should be re-opened by an amendment on Third Reading". It is in that respect that I do not think that we have altogether fulfilled the spirit of our proceedings in this House.

My second point is a different one. One question has not been answered in the course of these long debates. What is it that the opponents of Maastricht suggest? What do they really want? It is a difficult question to answer because, as I think they would agree, the opponents of Maastricht are a coalition. Not all those who oppose the treaty share the same objective. It is made even more difficult because, with the exception of the noble Lord, Lord Tebbit, I have not heard anyone try to spell out the alternative policy which they wish this country to pursue. There has been a good deal of wailing and gnashing of teeth about the consequences of our signing the Maastricht Treaty. There has been much less attention paid to the consequences of our failing to sign it.

Lord Harmar-Nicholls

My Lords, does the noble Lord recollect that it has been said again and again that we wish to operate within the terms of the Treaty of Rome and not with an extra treaty which carries us further down a different road from the Treaty of Rome?

Lord Bonham-Carter

My Lords, that indeed is the view of some of those who oppose the Treaty of Maastricht. I am coming on to that point. The noble Lord, Lord Tebbit, argued at Second Reading—I think that I am representing his views fairly—that we could refuse to ratify the treaty and yet retain the benefits of remaining in the Community. That is the view which I understand the noble Lord, Lord Harmar-Nicholls, is now expressing. At Second Reading, and now again, I would contest that view.

It is only possible to maintain that view if you are content to remain in the slow lane in a two-speed Europe. I do not believe that the 11, or the 10 as it may be, would allow this country to arrest the progress of the convoy. I do not believe that they would allow this country to delay the advance to a more integrated political and economic Community that Maastricht offers. I do not believe that they would allow it to slow down the expansion of the Community to which it seems to me failure to ratify Maastricht on the part of this country would inevitably lead. It would lead either to the postponement of negotiations with the EFTA countries and the central European countries or, alternatively, to a period of chaos which would have the same effect. Would that he what we want? Surely the inclusion of the EFTA countries within the Community is a very high priority. Surely the inclusion of Poland, Hungary and Czechoslovakia is very important for Europe as a whole, for the political stability of Europe and for the post-cornmunist world in general. That is a consideration which the opponents of the ratification of Maastricht should bear in mind.

Moreover, I thought that no one was keener on the expansion of the Community than the noble Baroness, Lady Thatcher. I believe that a failure to ratify Maastricht and a desire to expand the Community are incompatible objectives. It is my belief that if we fail to ratify Maastricht the other members will have an IGC—on the telephone if necessary—and perhaps with some relief will go ahead without us. That, of course, although I have riot heard it said, is what some of the opponents of Maastricht really want. They are not only against Maastricht, as the noble Lord, Lord Harmar-Nicholls, is. They are also against the Treaty of Rome as a whole. They would like us to renounce it, though once more they do not spell out the consequences of that course of action. That is something which we have to face—for we would be then a small island on the edge of a large continent. We would be isolated and the isolation would be far from splendid. We would have the choice of being either a satellite of the Community or a satellite of the United States of America, with no influence on either.

That bleak future has to be faced, has to be spelt out and has to be understood. Whatever the benefits of being at the heart of Europe may be—and I and my colleagues think that they are substantial—the consequences of refusing to ratify are very serious.

I should like to thank your Lordships, and particularly the noble Baroness, Lady Chalker, for her patience and good humour in conducting these lengthy and sometimes very repetitious proceedings.

8.17 p.m.

Lord Tebbit

My Lords, I had hoped to confine my remarks to a very short speech, but having heard the noble Lord, Lord Bonham-Carter, I have to extend my remarks rather more than I had wished I find his arguments impossible to accept. First, there was his suggestion that we, the critics of the treaty, had not devoted sufficient time to the alternative strategy. I can imagine what the noble Lord would have said had we, in Committee or on Report, devoted a great part of our speeches to the alternative strategy for Europe. He would have been unending in his condemnation of the abuse of the House, because of course Committee stage and Report are not appropriate for such alternative strategies to be put forward. So what he is really saying is that in the debates on Second Reading and perhaps this evening he has not heard sufficient of an alternative.

The noble Lord was kind enough to say that I had put forward an alternative. I think it is an alternative with which all of my friends in the House who have been opposed to the treaty would be able to agree. I think that in what I have said in that respect I speak for virtually all of them. I must say that some of the noble Lord's arguments were extraordinary. The argument once again that if we were not to ratify the treaty we would be discriminated against by our partners, that they would connive against us, that they would break the Treaty of Rome itself, the treaty which says that any alterations in it must be by consent of all 12, and that they would seek to get around our consent and make separate arrangements, is not only disgraceful towards our partners but, if that is the case and if the noble Lord believes that our partners would behave in that manner, what on earth is he doing advocating that we should sign another solemn agreement with them, which presumably they would treat in the same way?

I thought the noble Lord's most extraordinary statement was that failure to ratify the treaty would make it more difficult to expand the Community in the way that I have advocated, a way to which I notice now the Prime Minister is beginning to give greater stress—that is, to open the Community on the western edge of Europe to our friends in central and eastern Europe. A moment's consideration should lead to the obvious conclusion that those states, when they apply to join the European Community, will have to comply absolutely in every respect with the whole of the Treaty of Rome, as amended by the Single European Act and now by this Treaty on European Union. They will not be given any protocols or let-outs from the social chapter or from the commitment to a single currency. It is inconceivable that in the lifetime of almost anyone in this House that they will be able to jump that hurdle.

What is clear is that this treaty will build a new Iron Curtain across Europe. It will be an economic and social Iron Curtain which those powers will be unable to penetrate in order to join us. That is the most serious of all the criticisms of this treaty which can be made by any of us as Europeans; and the great majority of us in this House and in the other place see ourselves as Europeans. I am extremely angry that that suggestion should be made because it is absolutely bereft of any logic, substance or of any morality.

Perhaps I may now turn more gently to the noble Lord, Lord McIntosh.

Noble Lords

My Lords, Lord Richard.

Lord Tebbit

My Lords, the noble Lord, Lord Richard. I am very sorry. The noble Lord has disappeared for a moment but I know that he will not be far away. I have to tell him and other noble Lords that it is the view of the great Japanese companies such as Nissan, not only that they will remain investing in the United Kingdom even if the social protocol comes upon us—they know it is going to if this treaty goes through—but it is also their view that they would remain investing in this kingdom even if the Maastricht Treaty were not ratified. So there is very little comfort for those who choose to make that argument.

I find it depressing that so many speakers could suggest that the German courts might strike down the treaty and although Germany would therefore be unable to ratify it would not lose its place at the centre of Europe, but that if this House, the other place, or the courts of this land, were to strike down the treaty we would be cast into outer darkness. I find that a curious, defensive argument and one which could only spring from some sense of inferiority about the role of this nation which I do not share.

Over the weekend I read again a part of the history of the Royal Air Force in the Second World War. In some curious way I turned to those pages which give a graphic account of the role of the Royal Air Force in the battle of Maastricht in 1940. Noble Lords will recollect that that was one of the most gallant actions of the whole war in which at least two Victoria Crosses were won by British aircrew who attempted to destroy that bridge over which the Germans were advancing.

There is a graphic, amusing and moving account of one of the pilots who was shot down. Happily, he survived and was taken prisoner. His German captors said to him "You're a crazy country; you're a crazy people. You allowed us to take the bridge. You gave us two days to reinforce around it and to put up our air defences during which time you did nothing. You then attempted to bomb and destroy the bridge". Am I alone in detecting in that story a pre-echo of the argument, "Ratify Maastricht now and we will put right the faults in future" now being put forward? I suspect that there may be Germans today saying "You're a crazy people. You let this thing happen to you. You sign up to it all and you say that that is the only way in which you will be able to amend it later". I find that as curious an argument as I would have done in 1940.

There is no point in once again going over the discussions that we have had over recent weeks. I shall refer only to the proposition which I put at an early stage of our debates. We identified what I called the pegs which were put in place by this treaty and on which there would be hung legislation in future and the further developments of this treaty and the Treaty of Rome from 1996 onwards.

Our discussions were illuminated, perhaps above all, by my noble friend Lord Cockfield. I recollect him saying "Why should you be surprised? Why should you make such a fuss? This treaty is simply dotting 'i's and crossing 't's. If you did not know in 1972 that this was going to happen, you were mugs. You did not read the treaty". I recollect him saying that the reference to an ever-closer union with the peoples of Europe was quite clearly reference to the creation or granting of citizenship of the European union. I find that difficult to accept.

We have seen a progress from the Common Market, which we joined, and the European Economic Community to the European Community and now the European Community which begets the union. I believe that there are radical differences between the Europe post-Maastricht and the Europe of the Treaty of Rome in 1972. I do not accept that merely because we have accepted the Treaty of Rome and the Single European Act we are bound tonight to accept this treaty too, and presumably the next one when it comes along.

Subject to the votes in this House and the other place on Thursday, and the legal challenge of the noble Lord, Lord Rees-Mogg, this treaty will be ratified. If it is, it will be ratified without the consent of the British people. They still do not understand what is in this treaty. Although we have had many hours of debate, they have been worthwhile because they have helped to put on record what Ministers believe the treaty means and what others do. However many hours of debate we have had, the people outside this place have been cut off from that debate. They have felt helpless and unable to influence it. They were unable to influence it by their votes at the last general election and they have been unable to influence it in any way. That is dangerous.

As I observed last Wednesday, the Government cannot claim an electoral mandate for this treaty and simultaneously deny an electoral commitment to lower taxes and not to raise them; and in particular a commitment not to impose VAT on electricity and gas. The Government cannot have it both ways. But what is certain is that the people have not spoken.

The denial of a referendum was an act of supreme folly. It was an act which, superficially, was justified on the ground that it would undermine our parliamentary democracy. I believe that far more was it motivated by a fear that the people would not accept this treaty. I believe that that is dangerous because if the people of this country find that the laws which are made under this treaty are unpopular and unfair as they see them; that they are laws which are against the interests of the people of these islands, they will see them as laws which have been enacted without the consent of them, the people. They will see them as laws which lack legitimacy and the democratic process.

I supported the late lamented, or unlamented, community charge legislation. I would do so again. What we know is that that legislation became so unpopular that it was overturned. Could any of the legislation which will be enacted under this Bill be overturned if it becomes unpopular with the people? No. There is no process for that. My noble friend has confirmed to me my view that under this treaty we could have an incoming government with an electoral mandate for a change of foreign policy saddled with the foreign policy of its predecessor and unable to change it. My noble friend argues that that is a good thing for Europe because some of these continentals change their governments so often that foreign policy would be waving backwards and forwards all over the place if we allowed that sort of thing.

How will the people of this country regard these matters which are being done in their name without their consent? The Treaty of Rome itself provides for some degree of law making without the consent of the people, but there is a difference of degree—extraordinary degree. The Treaty of Rome provided for law making over such things as external trade. It also provided for a veto which we now see disappearing from us. But under the Single European Act and, above all, under this treaty, both the width and the depth of the legislation which will be coming from Brussels is vastly increased. There is more and more likelihood that those laws will be found unacceptable by the people of this country. And what are we to say to the people if they disobey those laws? Are we to say, "You voted for them"? We cannot say that. Are we to say, "You were consulted"? We cannot say that.

This treaty will end in tears not only in this kingdom but across the rest of Europe. This treaty is a recipe for the disillusionment of the people with the democratic process. This treaty is a recipe for the rise of the nastiest and most virulent forms of nationalism which will be seen across the Community. That is not only my view. I recollect the speech that was made on that subject in another place by my noble friend Lord Lawson. He was right. If this treaty is passed today, it will be a sad day for this Parliament. It will be a sad day for this nation. It will be a sad day for Europe. I want no part of it. I want my hands to be clean.

8.32 p.m.

Lord Harris of High Cross

My Lords, by some tests these protracted debates have been intensely unwelcome. The large issues at stake have divided old friends and colleagues and could have made for great personal bitterness. I must say that I have found the 12 days instructive. I agree with the noble Lord, Lord Richard, that the arguments have been conducted with tolerance and good nature. I have certainly developed a stronger admiration for some noble Lords, even including the noble Baroness, Lady Chalker, and the noble Earl, Lord Caithness. They have consistently put a very good gloss even on the weakest aspects of their case.

There was one lapse, which came in the referendum debate. I dropped a note to the noble and learned Lord, Lord Rawlinson, to say that I would have wished to refer to it. In his absence, I shall not pursue it. However, any notion that this performance has been "a facade" to conceal "a vendetta" to destroy the Government and the Prime Minister is, in my view, wholly without any foundation whatever. If I may say so, I thought it instructive that such remarks should fall from a noble and learned Lord, thereby demonstrating that legal eminence is no necessary guarantee of judicial objectivity.

In the Lobbies I have found myself in the company of noble Lords who disagree intensely with me on many aspects of social and economic policy. It is easy to misconceive that alliance as opportunistic. I believe that the truth of the matter is that, despite our differing judgments, we are fundamentally united by an overriding devotion to the belief that differences over policy should be settled by vigorous debate in this country rather than by dubious ideals in Brussels and thereabouts. Unlike the noble Lord, Lord Peyton, on Second Reading, we have more confidence in self-government in Britain than in the phantom of good government as a subsidiary of a superstate shaped by the likes of M. Delors and Herr Bangemann.

I think that it is safe for me to say that my noble friends and I are also united by a suspicion of endless reassurances by Ministers that the treaty does not mean what it says, that what they call "the process" is not speeding up, and that much of the Maastricht Treaty will not happen. The most beguiling reassurance has been that Maastricht is no great innovation. That was said a good deal on the occasion of the referendum debate. We were told repeatedly that the real constitutional departure was the Single European Act. Some noble Lords from what I always used to think was the "gents' party", the Tory party, seemed to take pleasure in tormenting my old friend the noble Baroness, Lady Thatcher, saying that she had been responsible for the extension of qualified majority voting and all that flowed from it. It may be recalled that the noble Baroness admitted that she had been mistaken and that she had burnt her fingers.

I have a more serious confession to make. It is that at the time of the Single European Act I was completely taken in by the assurances of the noble and learned Lord, Lord Howe, the noble Lord, Lord Cockfield, and others that the purpose was to remove obstruction to the completion of the single market, to which I am devoted as strongly as—I would think perhaps even more strongly than—any Members of the Liberal Democrat Benches. It was those assurances that led me to take no interest whatever in the proceedings in 1986.

Ever since then, I have been chastised by an old friend, a greatly respected surgeon by the name of Sir Reginald Murley, who at the time wrote to his MP expressing anxiety about the Single European Act. He has sent me a copy of the letter that he received back on 14th August 1986 from the Minister of State at the Foreign and Commonwealth Office which, as we now know, is the secret location of the "Department of Soothing Reassurances". The letter reads as follows: Sir Reginald is concerned that the European Communities (Amendment) Bill will lead to a dramatic loss of sovereignty. I can assure him that this is certainly not the case. The Single European Act, to which the Bill gives effect, does not represent any significant change in the structure of the European Community or in our relationship with it". The letter then states: If the Bill has not received a great deal of publicity I think that is because most informed commentators have seen the Single European Act for the relatively modest reform that it is There is no question whatever that seven short years later those reassurances have proved to be false. They have turned out, I am sure unintentionally, to be a major deception, and I worry about many of the assurances that we have had during these interesting debates.

The debates have left me in no doubt that there are irreconcilable differences at the heart of Europe—not just in this House but more especially on the Continent. With few exceptions, Tory MPs and Ministers are not positively enthusiastic about Maastricht, but they feel that they are stuck with it. They mostly do not want a stronger European Parliament. They are unhappy about a common foreign policy. They do not believe in a single currency. They are not confident about the social opt-out. They are fearful of centralisation and creeping federalism. Yet, on all five of those issues, their political allies in the so-called European People's Party cannot wait for the next leap forward. Weary Members on the Government Benches who think that their travail is at an end will, I fear, find that they are sadly mistaken.

I conclude with a personal statement. It is easier to speak freely from the Cross Benches. If I sometimes did so emphatically, it was because I felt that I was talking on behalf of many old friends on the Government Benches who agree with me but who cannot say so for fear of sundry unpleasantries. During most of a working life spent observing politics, I became well accustomed to being in a small and even despised minority. I recall most of the senior Tory defenders of this doomed enterprise of Maastricht earlier upholding, however reluctantly, the Keynesian-collectivist consensus on the mixed economy, state industries, subsidisation, trades union privilege, and incomes policy. What has become of all those delusions? They may now acknowledge that they were proved wrong then, and, I believe, with calm conviction, they will be proved wrong again on Maastricht. In a nutshell, it puts all the hard won Tory economic progress at further risk.

If the Bill is put into effect, our false position and internal contradictions will soon bring troubles on all our heads. The heart of Europe is likely to become even more of a battle ground. We would do well to be thinking now how we can salvage a wider free trade area, made more difficult, as the noble Lord, Lord Tebbit, said, by the obstacles that Maastricht will put in the way of accession by the countries of Eastern Europe. With no particular joy, I feel obliged to vote against the Bill on Third Reading.

8.42 p.m.

Lord Jay

My Lords, these debates are coming to an end. They leave two main thoughts in my mind. The first is the patience and persuasiveness of the noble Baroness, Lady Chalker, who has been with us throughout. The second is consciousness of one extraordinary contradiction in the arguments for the Bill put forward by its supporters in the Government and outside. At one time it was argued, notably by the noble Lord, Lord Cockfield, that there was little in the Bill at all: it was just dotting the "i"s and crossing the "t"s. It was all included in previous legislation. On the other hand, we were told that if we did not pass the Bill the upheaval and disaster would be so great that the Government might resign, the Prime Minister might resign and heavens knows what else would happen.

Both those arguments cannot be true. Either there is little of substance in the Bill—it is just dotting "i"s and crossing "t"s—in which case one is bound to ask why we have had this vast paraphernalia of the treaty, the legislation and everything else; or there is substance in the Bill, and sweeping losses of sovereignty are involved. In that case, both Houses of Parliament have been fully justified in arguing at considerable length and voicing all the objections to these further changes, which is what they are.

We all know that it is the latter argument that is the truth. The Bill contains substantial transfers of sovereignty on a whole range of subjects, from citizenship on the one hand, to foreign policy and security on the other, away from the British Parliament. In addition, although we are not, I hope, formally and legally committed to rejoining the ERM (and later destined for EMU) it cannot be denied that a presumption has been established that we shall probably attempt to join, whether we like it or not. We shall be told by the likes of the noble Lord, Lord Cockfield, in 1996, 1999, or whatever it is, that we accepted that principle in the Maastricht Treaty. It is for those two reasons that I shall vote against the Motion tonight.

Whether the treaty is ratified or not, I hope that the Government will bend some of their energies, if there are any left, towards three possible future developments. First, it is surely—again with or without ratification—in the overwhelming interest of this country that so long as we are members of the Community, the Community should be widened extensively and rapidly. There is no reason why the EFTA countries and the Eastern European countries should be kept out against their will. Indeed, if they were, the whole exercise would not be uniting Europe; it would be dividing it. It is highly probable that on all the topics upon which we were at issue with the rest of the Community, the EFTA countries, in particular, would support our view. I hope that the Government—at least here we carry the Liberals with us—will argue forcefully and effectively for widening over the coming months.

Secondly, the other overwhelming interest of the UK is that there should be an early and effective reform of the CAP. If we are at the heart of Europe, why is it that when all of us here agree that that is necessary and important, there has been little more than negligible reform of the CAP in all these years? The best chance of obtaining real results is the GATT Uruguay Round, because there a large number of countries, including the US, are, in effect, on our side. Therefore I hope that we can trust the Government, whatever happens with the Bill, to press in the next weeks, and not leave too long, the chance of rescuing the GATT round and ensuring at last an effective reform of the CAP. That means a reduction in prices and not just a reduction in expenditure or the set-aside remedies which have been applied until now.

The third point I put to the Minister is that, for heaven's sake, so long as we are members of the Community, cannot this country press more effectively for expansionary economic policy rather than the extreme deflationary policies which are written down in black and white at present in the guidelines and instructions to the central bank? If those policies are followed, we shall be heading for ever growing unemployment throughout the Community, whatever else is done. If that happens, then all the results predicted by the noble Lord, Lord Tebbit, are likely to come true. The effects will be rejected by almost all the countries of Europe. Can we at least have some assurance that, with ratification or not, the Government will apply whatever energies they still have to those three objectives?

8.49 p.m.

Lord Elton

My Lords, as one who has stood at the Dispatch Box in the recent past, to take through a highly contentious Bill, not altogether supported by all my noble friends, I should like to start by paying tribute to my noble friend the Minister for the patience, thoroughness, courtesy and inexhaustible knowledge with which she has replied to all the attacks made on the Bill that she has taken through the House. I extend that tribute in appropriately lesser degree to others of my noble friends who have answered various issues at the Dispatch Box. There have been feelings of passion and conviction about the matter we have been debating. Those feelings have been held by Members of great seniority and experience in your Lordships' House and in another place. In that sense it has been different from other measures with which we have had to deal.

I have been a Member for what in this House is a relatively short time; only 20 years. During that time I have noticed how the House adapts itself to deal differently with different measures. It is made not of cast iron but of steel, and it is flexible. On this occasion it has adapted itself rather violently to the pressures within it. For instance, it could have been argued that as the treaty was not susceptible to amendment, amendments which were designed to have the effect of amending the treaty were out of order. That would have excluded many amendments in Committee. That argument was not adduced and the deeply held convictions of my noble friends and others were properly accommodated in debate.

In Committee the debates took on a character with which we were not familiar. Perhaps because of the depth of feelings of those who brought forward their arguments they felt it necessary to make them at length and frequently. f say nothing about the propriety of that, because I believe that the House properly adapted itself to the pressures of the moment. However, there is a danger that if that adaptation takes the form of precedent and future Committee stages follow that form, or if on Report the Marshalled List is to contain a series of amendments which do not clearly fall within the three categories adduced by the noble Lord, Lord Bonham-Carter, in his brief speech, those stages will also be less efficient.

I fear that if one merely says that and does no more, the precedent will exist and the habit will have been formed in the minds of those Members who have attended these debates, other debates being over-shadowed in their memory. I fear that the precedent will be adopted and our system will change. That will be wholly against the interests of this House and of good legislation. I hope that the usual channels will arrange for the proceedings on the Bill to be brought before the Procedure Committee so that the precedential effects of what has happened can be limited. The benefits of our proceedings on this Bill will be left and the dangers will be excluded from future proceedings. That is in my mind one of the more important long-term issues before your Lordships.

8.53 p.m.

Lord Moran

My Lords, consideration of the Bill has been a remarkable experience. Some distinguished members of the Conservative and Liberal Democrat Parties have maintained that it has been a prolonged filibuster by those of us who oppose the Treaty on European Union. I entirely repudiate that. There has been thorough and comprehensive consideration of all aspects of the Bill and the treaty, which has been very valuable; and so there should have been because this treaty is of profound importance. A dozen or so of your Lordships from the Conservative and Labour Benches and from the Cross-Benches have had to constitute the effective opposition. As a result, a great deal of information has come to light about the treaty and the Community. I have certainly learnt a lot.

Despite my deeply felt doubts about the wisdom of their policy on this matter, I share the wish of the noble Lord, Lord Elton, to pay tribute to the Ministers. In my case I would like to thank in particular the noble and learned Lord the Lord Chancellor, the noble Baroness, Lady Chalker, and the noble Earl, Lord Ferrers. They have been invariably courteous and helpful. I should like to ask them to thank the civil servants who had to work so hard in preparing the briefs in reply to the numerous criticisms and questions that we have asked. I was once one of those civil servants and in my time I sat in the official box. Therefore, I know just what is involved. They have done a remarkable job and I hope that the Minister will thank them.

I was greatly depressed by the huge votes cast against us on citizenship and the referendum. In a fascinating article which the noble Lord, Lord Beloff, wrote in The Times, he stated that in some respects he had been reminded of Vichy. I too had the same reaction. I never understood how it was that so many distinguished Frenchmen were prepared to compromise the independence and self-respect of their country. I found it equally hard to understand how so many peers could contribute to those huge votes. During the vote on the referendum some 450 privileged peers voted to deny the people the right to a voice on the Maastricht Treaty. I believe that perhaps that will hasten the demise of the House in its present form. I very much regret that.

I have one specific question which I wish to ask the Minister and of which I have given notice to the noble and learned Lord the Lord Chancellor. It relates to the position of the Sovereign as a citizen of the Union, a subject which my noble friend Lord Tonypandy and I raised in Committee. I put forward some points on Report but I have not had a full answer. On Report I mentioned that my noble friend Lord Tonypandy and I had had a valuable talk with the noble and learned Lord the Lord Chancellor. The noble and learned Lord has since written me a helpful letter and I am most grateful. It would be useful for your Lordships to know the principal points in that letter. Will the Minister in her reply inform the House of some of those points?

8.57 p.m.

The Earl of Onslow

My Lords, when my noble friend Lord Tebbit offered a gift to the Government they talked about gift horses. The quotation which my noble friend on the Front Bench really wanted was the famous one from the Aeneid when Laocoon came down and warned the Greeks not to take the Trojan Horse: "Timeo Danaos, et dona ferentes". In other words: I fear the Greeks, especially when they are bearing gifts". That set me thinking. It made me think that those of us who have grave doubts about the efficacy of the treaty felt not unlike the Leonidas at Thermopylae, or perhaps Cassandra warning about what would happen at the fall of Troy, and no one would listen to her. Thermopylae is probably over, but Salamis is almost inevitably bound to happen. That Salamis will be because the treaty is deeply flawed. At some stage it will force this country to make a choice between breaking the treaty or sacrificing its own interests.

Every single bank clerk in Barclay's Bank, Surbiton, knows that the financial provisions of the treaty cannot take effect. My noble friend on the Front Bench gave a definition of European union which is wildly at odds with any definition given by anyone else on the Continent. It is undoubtedly true that we have sacrificed greater lawmaking powers to Brussels. Either people have done that knowingly and should not have or they did not know and they should have. This treaty is an unhappy treaty.

I completely agreed with my noble friend Lord Tebbit pitching in to the noble Lord, Lord Bonham-Carter, whose opinion was that it was perfectly all right for the Germans not to ratify the treaty but that somehow we should be left cringing on the outskirts of Europe if we followed our total treaty rights. We have every right to say that one further treaty agreed to by the European Community will not become law. The Treaty of Rome is quite clear about that. It can only be changed unanimously—and "unanimously" means all 12 countries agreeing. If one country does not do so, that is perfectly all right by the Treaty of Rome because it says so. To pretend otherwise, means that you are, in effect, inviting—as my noble friend Lord Tebbit said—others to break the treaty.

Obviously I have a greater respect for the others who signed the treaty than does the noble Lord, Lord Bonham-Carter. My Cassandra speech will now end after three minutes. It only remains for me to say that I shall be both unhappy and, I suppose, a little smug, when the inevitable time comes for me to say, "I told you so".

9 p.m.

Lord Bruce of Donington

My Lords, I am sorry that the noble Lord, Lord Bonham-Carter, should have taken such a jaundiced view of our activities in this Chamber during the passage of the Bill. Speaking personally, and as one who has been interested in the subject since the Messina Conference which took place way back, I have found the proceedings in this place most encouraging. I should like to take the opportunity to thank the noble Baroness, Lady Chalker, for the very constructive way in which she has sought to allay anxieties, to reply to questions and to give such indications as to the future that she feels, at present, justified in giving. I extend those remarks to her colleagues on the Front Bench.

However, most of all, I have been extraordinarily moved by the number of noble Lords who have seen fit, with one or two exceptions, to present themselves continuously in the House over the past few weeks. Unlike similar proceedings in the other place, the proceedings in your Lordships' House have been singularly well attended. Indeed, I remember sitting here all day until about a quarter-past-eleven and recalling that on one occasion at least 150 Members of the House were present for an hour-and-a-half before the closure listening to our proceedings. I find that very encouraging. In my view, it augurs well for the future.

I make that observation because things will never be quite the same again when it comes to considering legislation, or proposed legislation, often verbose, ill-digested and full of Euro-waffle, that comes from Brussels from time to time. Never again shall we have the same uncritical acceptance of what in the past has gone through on the nod, or on the basis of, "We have heard it all before and we are not interested in it". For example, the reports issued by the European Communities Select Committee, taken in toto over the period of one year, in their comprehensiveness, their devotion to detail and in the authoritative nature of taking evidence from witnesses—that is, listening, considering the evidence and arguing with them—are worth 10 times the emanations that issue from the plenary sessions of the European Parliament in Strasbourg. I think that that reflects great credit upon us.

I am particularly indebted to my noble friends on the Front Bench who have clarified the Labour Party's position beyond all doubt. We now, happily, have a position where the two Front Benches in both Houses of Parliament are united in their advocacy of the main items in the Maastricht Treaty. I must say that I am a little amused when I observe that there is an effective difference between the two parties on the question of the social chapter.

The social chapter was considered by the all-party Select Committee in another place. Noble Lords may not have read the report, but I have had the opportunity of doing so. Its members came to the conclusion—and the words are theirs, not mine—that it was "Much Ado about Nothing". Indeed, in his account of the social chapter, my noble friend Lord Richard reduced it to a point of such innocuousness that one wondered why anyone was arguing about it. In point of fact, it has been used by both parties for their own purposes. In my own party the social chapter has been used as a carrot to adorn the Maastricht Treaty that they adore so as to make it more palatable on superficially socialist grounds to the remaining doubters. However, in the Conservative Party it has been used for the opposite purpose: it has been used to scare all opposition to the Maastricht Treaty. But, in the event, both parties are agreed upon one thing; namely, that the Government of this country, whatever party is in power, are not in fact capable of conducting the country's economic and political affairs. There has been an abdication from political responsibility for the conduct of British affairs.

The Maastricht Treaty provides for economic and monetary union and a single currency. We shall leave the opt-out to a later stage, because we all know what that is really worth. It will mean that the government of the country shall not have the political responsibility in the eyes of the British people for the catastrophes that will undoubtedly occur by the application of rigid rules imposed by independent bankers and by non-elected and non-accountable civil servants.

If misfortunes happen any British Government, whether they be Tory or Labour, will say, "Of course it is not us; it is the EC. It has nothing to do with us; it is all to do with the bankers" instead of accepting, as any British Government should, responsibility for the conduct of British affairs. My own party is obviously nervous of any kind of repetition of the "winter of discontent". It does not think that it is capable of conducting affairs within the Labour movement as a whole—of which it is a principal part —so as to arrive at a satisfactory accommodation with the trade union movement to ensure that non-inflationary increases in wages are kept within reasonable control. My party is not convinced that it can do that. It is not prepared to incur the odium so it wants the odium to go outside. External bankers will exert the discipline rather than ourselves as a constructive movement working together to achieve what MITI is already able to achieve in Japan; namely, an understanding and a consensus of how the country should work. Similar observations apply to the Conservative Party.

Here we are all locked in mutual amity. I rejoice in that. It is nice that we can all get on in a civilised way. But what relevance will that institutional aspect of our affairs have and what effect will the changes in institutional affairs—that is really all the Maastricht Treaty brings—have on massive unemployment that is still continuing in our own country and in Europe? What effect will that aspect of our affairs have on the ordinary lives of people and in arresting the growing disparities between poor and rich? What effect will that aspect of our affairs have on relieving the burden of the sick, the infirm, the aged, the weak and the young? That is a different matter. Maastricht has not been concerned with those matters.

I well recall an exchange I had with the noble Lord, Lord Bonham-Carter, way back when I asked him to name one advantage that had so far been bestowed upon the United Kingdom as a result of our membership of the organisation we are discussing. His answer is on the record. He said, "Well, we should have got in earlier". There has still been no response as regards what advantages have accrued. Every time a new problem arises in Europe and every time a new misfortune portends, the reaction of Europe and the reaction of the Community is not to deal with the practical problem that arises but rather to demand more powers for itself—and so it goes on.

I well remember when I was president of the European Parliament's regional policy group. That body was often reproached with the fact that in spite of all the institutional aid that was given through the regional development fund—a principal contributor to that fund was the United Kingdom—it did not result in the poorer regions coming any closer to the rich. In budget debates I often reproached that body for the fact that despite all its efforts the rich were still getting richer and the poor were still getting poorer. The response was always that a new step forward was being taken to institutional integration. That meant more powers for the Commission and a new extension of Community competence. That was always the answer.

If the noble Lord, Lord Bonham-Carter, should reproach us for not having produced an alternative, I must say that alternatives, even within the limited time available, have been produced many times here, even during the course of debates. We are powerless at the moment to eliminate the obscene and ridiculous expenditure of billions of pounds on tobacco. We cannot even stop that and no Maastricht Treaty will prevent it.

Maastricht has proved marginal to our needs and will prove to be marginal to our needs. It may never come fully into operation. Be that as it may, the debate itself has been well worth while. I hope I may without impertinence congratulate the House on the way in which all sides have conducted themselves in the course of this debate. I congratulate them on their forbearance in listening to me from time to time. I assure your Lordships that in regard to the future of Europe, you haven't seen anything yet.

9.15 p.m.

Lord Harmar-Nicholls

My Lords, the Motion before the House is that this Bill do now pass. It is the tying up of the Maastricht parcel before it goes on to the statute book as the decision of the country.

I recognise now that the debate which has gone on over the whole of this period has been a battle of tactics. The government tactics were quite clear, and they have carried them out brilliantly. They were made quite clear when my noble and learned friend the Lord Chancellor opened the debate. He said that the Government wanted the Bill to go back to another place unaltered. The Government wanted it to go back along the corridor in the same state as we received it. The Government are committed to Maastricht, and have made no bones about that. Therefore, so far as concerns this House, the tactic was not to alter the Bill in any way in order to avoid it having to go back along the corridor to the other place, which has the power to do something about it if it is so inclined.

I pay tribute to my noble friend Lady Chalker, who has carried out that tactic superbly. That is not new to me. I knew and admired her long before she came to this House. I know her abilities. I have witnessed them on many occasions. They could not have been displayed at a higher level than they have been while she has been carrying out the Government's tactics regarding the Maastricht Bill in this House. Similarly, my noble and learned friend the Lord Chancellor, who is our only Cabinet representative in this House, was the only Member of this House with the authority, as a member of the Cabinet, to carry out the Executive's intention in regard to the Bill.

What were the tactics of the Opposition? Tonight I have one lesson which I hope that many of my noble friends will bear in mind. The Opposition's tactics have been very clear. They were made blatantly clear by the Leader of the Opposition when he said, after all the hullabaloo and after joining with the Government to get the Bill through, that when it comes to the final point and the Bill is to become part of the statutes the Opposition will abstain.

What is the point of those tactics? I have referred to them fleetingly before. However, I am something of a warhorse and understand the hustings a bit. They wanted to have a foot in both camps. They have done it brilliantly. On the one hand, for those who may think that Maastricht and Europe are a good thing they have tried to place on the record how loyally they have partnered the Government to set the Bill on its way. But they are aware, as we are, that many of their supporters are not quite as enthusiastic as the Official Opposition about even going through the pretence of following that road. Therefore, they want to be seen as being pro-European, but now they want to have a foot in the other camp. They do not want to be responsible for this Bill having the force of legislation in this land. They have used the excuse of the social chapter. They have said that all their efforts were directed towards the social chapter, raising wages and doing all sorts of wonderful things.

I do not know how the noble Lord, Lord McIntosh, can abstain. He has spoken very ably from the Dispatch Box on the other side of the House. His orations have been very well presented. There have been no "ifs" and "buts" about them. I find it hard to believe, with such speeches as the noble Lord's on the record, that when it comes to finalising all that he has argued for he will abstain.

I hope that many of my noble friends will recognise, as I do, that we are now back to party politics with a vengeance. The Opposition have their eye on their electoral prospects. The tactic of not following through the strength of the arguments which they have used all this time is based purely on those grounds.

I pay tribute to the efforts of my noble friends Lord Pearson and Lord Tebbit who have placed their view on record with brilliance and ability. I believe that the Bill will not work. Moving, as it does, into the realms of European politics and European social affairs, it will not work. The five years which I spent in the European Parliament confirm one factor clearly in my mind. One ingredient vital for the European theories to work in practice does not exist. Among the 12 there is no affinity. The affinity necessary to make the supposed theory work does not exist.

As I have sought to argue, there is nothing in Maastricht which could not have been accomplished by the Treaty of Rome. It is perfectly correct that I objected to the Treaty of Rome. I saw dangers in it. I did not vote for that treaty; I objected to it as energetically as I could.

However, that was 22 years ago. We are now 22 years further along the road. There have been many economic propositions. Matters are different from when I opposed the Treaty of Rome. We are now so far along that road that we have to continue and make the treaty work as far as we can. There is nothing in the Maastricht Treaty which could not have been achieved in the powers contained in the Treaty of Rome. By moving across the boundary from the Treaty of Rome into European politics and European social affairs, I believe that the dangers and the clash will come.

Over the past few weeks my noble friends have sought to improve the Bill if possible. We have not succeeded. The Bill is exactly the same. When the noble and learned Lord spoke first on the Bill he said that that was what the Government wished. I admire them and praise them for the success of their tactics. However, those or us who believe that the dangers still exist, and to an even greater extent, should not adopt the halfhearted, rather weak-kneed approach of the Leader of the Opposition. There is no question of abstaining. We ought to see the matter through.

I hope that we shall go into the Lobby on the Motion that the Bill do now pass to confirm the views that we have expressed from the beginning: that it is a Bill which ought never to become part of our statute. We shall then have done our best to seek to avert what may be a tragedy for the country in a few years' time.

9.24 p.m.

Lord Houghton of Sowerby

My Lords, I shall say something different. I shall have to ask your Lordships' forbearance for a moment or two, although I may not be able to stay until the end of the debate. As noble Lords will find out in due course, there are some things that old age will not stand for. One is to lose one's temper half way through the evening when one should be enjoying an intelligent debate on a serious subject. We have been listening to art orchestrated choir for the past hour and a half which has been properly taken care of by my noble friend Lord Stoddart of Swindon. Much of the activity in this part of the Chamber which interrupted our hearing earlier speeches was connected with the order in which noble Lords were to speak. I resent it. Our tolerance and courtesy are being exploited by that procedure. After all, you can hardly come into a debate on this Bill at present without hearing the same people who have been talking about it over the past few weeks. Again, that is an indication that it is about time that your Lordships' House regulated itself by having Standing Orders which give protection against what is an unreasonable prolongation of debates. The patience of the House has been much tested.

I support the Bill. What it says has had my support for over 20 years. I went into the Lobby with the then Prime Minister Heath to enable him to achieve the majority he needed for the principal Act—the European Communities Act. I was at the head of 60 Labour Members who defected from a three line Whip to go into the Lobby with the Government in order to obtain a Second Reading of that Bill. Now the Labour Party has become converted to the Common Market, although it was against it when it began. Its members have now become more catholic than the Pope; they should turn up in great numbers to support the treaty. But it is not happening like that.

The Bill points the way in which the country should be going. Any other way is bound to lead to a gradual decline which will be irretrievable as time goes on. We do not have the population, resources or will power to survive. We have tried for years but since the empire was wound up we have never shown arty signs of being able to recover by finding a new place to match the old in the world. A degree of co-operation with Europe is absolutely indispensable. Co-operation does not mean being submerged in a super state. It means that one is on equal terms with others in a collection cif nations which have come together to make it better for all to work for the future. We are in danger of overlooking the peacekeeping nature of the Common Market. Without that Europe could be exposed to the dangers of conflict. If the Americans leave with their forces, Europe will become a dangerous place again. That may happen. We must learn to keep the peace in Europe with outside aid.

Millions of people are in their graves today because of conflict in Europe. It was when conflict had nearly destroyed our economy and slaughtered our population that Winston Churchill came forward with some of the most federalist European speeches that have been delivered in the years past. Why he wilted in that regard and failed Europe by not continuing that clarion call and endeavouring to put it into operation, I cannot say. We shall never know what overcame the man. It is a great pity indeed that he did not persevere.

We should pass this Bill because it will give us an opportunity to develop further. Many of the features complained about in the Common Market today are measures which are necessary for the establishment of a level playing field for fair competition in an economic community. If your Lordships examine those measures, you will realise how important they are. I mentioned a few the other day and there are scores more: business, enterprise, commerce, freedom of movement of population, and freedom of movement of capital. All those matters are important. It is important to achieve a measure of uniformity in conditions of employment in order to give competition a fair run in the Community.

Perhaps noble Lords have noticed how English has become the world's language. Even in Europe do we hear our European friends talking to us in their own language? No, they talk in ours to make it easy for us to understand. In those circumstances we ought to feel flattered that there is much in the way that we do things that other countries in Europe would like to copy. I am not ashamed of being a European. I should be ashamed of being British if we were to fall below reasonable standards of existence and civilisation in this country. That is all I shall say. I feel passionately about the issue.

It is a great shame that the "comrades" are absent tonight. One can see that they are not in their places. The "comrades" said, to begin with, that this did not go far enough; then they abstained from voting when it came to the Bill in the House of Commons. More humbug has been talked about Europe on both sides in the past 20 years than about any other single topic. Our prejudice has come to the surface. Our intelligence deserts us. Our sense of history disappears. We walk about like a lot of morons repeating the stuff about Europe and how it is bad for us. I listened to my noble friend Lord Bruce of Donington. He almost made me weep with his doom and gloom. He belonged to an organisation within the Labour Party called the Anti-Common Market Labour Group. Three of its members are 1-ere at this moment. Two of them have already spoken, and there is another to come. It is no good going about this debate in its last hours as though it were the natural conclusion to a wonderful House of Lords seminar on the future of Britain and the Common Market. This is part of a political manoeuvre to make it difficult to do what the House has already made up its mind to do. So, for God's sake, let us get on with it.

9.32 p.m.

Lord Monson

My Lords, I say in reply to the noble Lord, Lord Houghton of Sowerby, whom I greatly respect, that we have all been speaking entirely for ourselves. There has been no conspiracy, no filibuster and no concerted plan of action in our speeches tonight.

I too should like to thank the Government Front Bench, and in particular the noble Baroness, Lady Chalker, for their courtesy and for the great trouble that they have taken in answering the questions put to them and the points made by our side and in defending, or trying to defend, the Government's position on the Bill. In response to this courtesy and these efforts, I felt it was only right to try to see whether I could say anything favourable about the Bill; whether I could think of any way in which it might benefit the people of the United Kingdom. Frankly, that has not been easy.

For example, the power to fine offending countries can be dismissed, since in principle it is likely to be used only against the countries which are least able and least willing to pay. Any attempt to enforce a penalty payment would almost certainly lead to political turmoil in the country in question, which might well endanger the Community as a whole.

That leaves the question of subsidiarity. If all the Government's numerous assurances about the scope and efficacy of subsidiarity turn out to be correct (and it is a big "ir); if the political will of the other member states coincides with that of the United Kingdom Government in this matter (which is an even bigger "if"); if therefore the claim that the noble Baroness's right honourable friend the Foreign Secretary made about seven weeks ago that henceforth subsidiarity will be the guiding principle of the Community and that the body of existing legislation must be regularly culled; if all that becomes a reality, then, and only then, will there be anything to commend this treaty from the British point of view.

The real test will come in the culling of existing legislation, which Mr. Douglas Hurd so commendably favours. What he and other members of the Government have not yet mentioned is the necessity of confining Community competence strictly to matters which affect the people of the Community as a whole or which have some genuine cross-border implications. Everything else must be devolved back to the individual nation states, where it belongs.

At this time of the evening one simple example will suffice. It is an example at which elitists will undoubtedly sneer but which all those who value individual freedom will applaud. As things stand, after 1999 it will become a criminal offence for an elderly greengrocer who does not like the metric system to sell to an elderly lady who does not understand the metric system a pound of apples or two pounds of potatoes, measured by imperial measurement. It will be a criminal offence, even though there is no question of intra-Community trade involved in such a transaction.

Unless that quite disgraceful power to indulge in petty and quite irrelevant persecution forced upon us by the Community is repealed, we shall know that all the assurances about the liberating consequences of subsidiarity once it is put into practice are eyewash and that therefore there is absolutely nothing in this treaty to commend it to the people of this country.

9.36 p.m.

Lord Willoughby de Broke

My Lords, it is an old propaganda adage that if you have to tell a lie, you should make it a big lie and tell it often. The big lie about what many now agree is a wretched treaty is that if we fail to ratify, we shall lose our influence at the heart of Europe and in some way become marginalised. But no one called the French marginalised when they came within a whisker of rejecting Maastricht. And, as my noble friend Lord Tebbit pointed out, no one questioned the German credentials when Herr Waigel declared German readiness unilaterally to opt out of the treaty's central doctrine of monetary union or when the German courts were asked to adjudicate as to whether it is proper for the Bundestag to ratify the Maastricht Treaty.

We have nothing to be afraid of. No mechanism exists to expel Britain from the EC; nor is there any will to remove Europe's second largest paymaster and softest export market. Britain's reprieve from the ERM and the social chapter, although they will, alas, prove only temporary if Maastricht is ratified, count for the time being as powerful plusses. If they can be secured permanently, Britain's dominant position as a magnet for offshore investment would be further strengthened.

Europe is becoming an economic black spot, with mass unemployment and the lowest rates of growth in the world. But elsewhere things are on the move. The USA is forming a North American free trade area without any of the EC's paraphernalia. Put the outstanding feature of the business landscape remains the performance of Asia. Already as large as Europe and the USA, the oriental economies will far outstrip their Western rivals over the next 25 years.

What do they have that we do not have? Asia, especially that part under the influence of the overseas Chinese, is antipathetic to welfarism, strong on family ties and strong on self-reliance. Those values are sweeping through South-East Asia, bringing a wave of prosperity. They are reminiscent of the ethic on which Anglo-Saxon wealth was built in the days when we had confidence in ourselves.

By contrast, Europe is saddled with a lethal combination of superpower envy and socialist utopianism—planning, welfare and high taxes—to which Maastricht would add further layers and unaccountable costs. We have come almost to accept them as part of the furniture of a developed state. Yet Asia seems to manage very well without cohesion funds, social chapters, harmonisation, collective international bargaining or monetary co-ordination. It is a living refutation of every false doctrine enshrined in the Maastricht Treaty.

Starting from nowhere, Hong Kong's living standards have reached those of Italy and this country. But the instinctive EC reaction is not to emulate success but rather to build barriers against it. Whether it is subsidising computers, protecting communications monopolies, raising tariffs against eastern Europe, pouring funds into the Mezzogiorno of Italy, cheating on the agricultural policy or imposing quotas on Japan—wherever you look you find the narrow instincts of Fortress Europe. For Britain, with our new-found belief in free internal markets and our historical faith in global free trade, all that is deeply against the grain.

The debate on Maastricht concentrates too much on big business. Prosperity principally depends on small and medium-sized firms which provide the momentum for all the most successful economies. The chairmen of giant corporations are natural corporatists, reluctant to speak out against government policy and seeing themselves as potential beneficiaries of Brussels' doomed ambition to build up so-called European "champions" against Japanese and American multi-nationals. Once we get away from the figureheads, the picture is very different.

Accustomed to the impartiality of English law, businessmen fear the transfer of authority to the European Court of Justice, which has already been used so destructively against our fishing industry. They have few expectations from a Brussels which depends on the Franco-German alliance for its authority. Coming from a law-abiding land with a free press, they feel at a disadvantage when government deals are negotiated behind locked doors or when they find themselves competing against Continental firms which have a different attitude to legal compliance; while the zeal with which British officialdom battens onto Euro-directives to cripple small businesses, be they herbalists, slaughterhouses, hotels or VDU users, saddens or enrages them. How can the Government simultaneously argue, on the one hand, that Maastricht is irrelevant—a modest treaty of no consequence—and, on the other, that it would be disastrous not to ratify it?

Recalling the inexorable progress towards European Union from the Treaty of Rome through the Single European Act, how can one be convinced by today's promises that the treaty does not mean what it so plainly does mean—the federalisation of Europe and the placing of Britain's fate in the hands of Brussels, Bonn or Paris? We must not be afraid of being called "anti-European" if we are against Maastricht, for on that definition half of Europe is anti-European. In many ways the United Kingdom is the most European of the member states of the EEC. Ours is the European language most spoken in the world; ours are the European commercial traditions most copied; ours are the European industrial corporations with the largest market capitalisation; ours are the European democratic institutions most copied in the rest of the world; and ours the European army most active in international peace-keeping.

If the Conservative Party came to the electorate with a manifesto for a return to the narrow band of the ERM—with higher subsidies to Greece and Spain, increased labour costs, more red tape, expensive food and the progressive replacement of our laws by politicised judgments made abroad —and if they then proposed to deprive the people of a vote on those matters and to subject them irrevocably to unaccountable Brussels bureaucrats with a long-established record of favouring foreign interests, I feel that they would get the electoral "bird". But that is what Maastricht stands for.

Should there be a Division I shall be voting against the Motion that the Bill do now pass.

9.44 p.m.

Lord Stoddart of Swindon

My Lords, I should like to join in the tributes that have been paid to the noble Baroness, Lady Chalker, and the noble and learned Lord the Lord Chancellor and their team for the patience with which they have dealt with the Bill throughout, and I also pay tribute to everybody else who has taken part in the debates.

The issue transcends party politics; it always has transcended party politics. As my noble friend Lord Houghton of Sowerby pointed out, in 1972 he reneged on a three-line Whip in order to vote in the Conservative Lobby for the Treaty of Rome, while I did not renege on a three-line Whip and voted with my party against the Treaty of Rome and going into the Common Market. So, yes, it is an issue which transcends party politics.

I have been very interested and indeed pleased to be able to co-operate with people from all parties and no party in providing the real opposition to the Bill, because undoubtedly in relation to the Bill, and indeed in relation to the Common Market at the present time —I hope my noble friends will forgive me for saying this—we are living in a one-party state. There is no traditional opposition to 'what is being done in Europe through Maastricht and perhaps future treaties as well. I have been very pleased to co-operate with people of different political views and different backgrounds to ensure that the Bill has been discussed in this House as it should have been discussed before —or at least the Treaty of Rome should have been discussed before.

Throughout the discussions on the Bill we have been asked by various noble Lords why we were discussing the Bill as everything was settled when the Treaty of Rome was passed. That is when it should have been discussed, they said. Of course it was when it should have been discussed, but it was not discussed. It went through the House of Lords with very little discussion. The same happened with the Single European Act. The House of Lords discussed it on four Fridays, with a handful of people speaking and taking part. At least this time there have been a large number of people taking part, moving amendments and taking an interest in what was going on. At least on this occasion, because the people who are concerned about this matter have been prepared to put themselves out, we have had a proper discussion.

Indeed, the debates have done something else. They have told the Government that when they make treaties in future they will not go through this House and another place like a dose of salts. They will be challenged. They will have to justify what they have done. From now on there is a growing body of people who will be watching what is done. That is an altogether good thing. That is why it has been right that this House, being part of the British Parliament, should have discussed the matter and should have discussed it properly.

There is another reason why it should have been discussed by this House and by another place. The Government and indeed the Opposition have said to the British people, "We do not believe in referenda. We believe that the discussion should be taken in Parliament by those people who know about these things and who can discuss the matter in detail". The Government cannot have it both ways. If they say that Parliament is the right place to discuss these matters, why have they been objecting to them being discussed? Why have so many noble Lords been bored and impatient and resented and criticised us for putting down amendments properly to discuss the treaty?

We have been doing the job which the Government have told us and told the British people we should be doing. I would have preferred this House to come to a positive resolution on a referendum. I believe that when issues of self-government and of the people's sovereignty are involved the people are entitled to be consulted. It is a great shame that this House did not give the House of Commons the opportunity to have another look at the question of a referendum. That is what it was about. But unfortunately senior Members of this House—very senior Members of this House —said that it would be wrong for us to ask the House of Commons to look at the question again. They said that the other place had made its view known and we should not interfere with it.

I have said before, and I repeat it, that if we are not entitled to ask the House of Commons to think again and to have another look at a matter, then what on earth are we here for? As I said on Second Reading, if we cannot do that, we are not worth a light and all we are doing is wasting car parking space in London and making available the dining facilities of this place to a select group of people. It is not worth it. In other circumstances the same noble Lords who would deny us the opportunity to ask the other place to think again will vote for asking the Government to think again. So not only have we had what I consider to be an unfortunate and dangerous point of view put forward for this House, but we have had a great deal of hypocrisy as well.

I conclude by saying, as the noble Lord, Lord Tebbit, said, that the people of this country do not understand this treaty. They have not had an opportunity to understand or debate the treaty, and they are not going to have that opportunity. It is such a pity. I believe that because that has not happened politicians are now not only distrusted but disliked as well. That is a great pity for the British political process which I so much support and love. It is such a pity that that should be so. Undoubtedly people will say "This is a treaty too far. We cannot live with it. We cannot obey these laws which are made outside this country". I believe that the Government will find increasingly that the people will tell them and insist that this country remains a self-governing democracy with decisions being taken in this Parliament by elected representatives who then form the government.

9.54 p.m.

Lord Beloff

My Lords, perhaps I may introduce a jarring note. There has been a great atmosphere of self-congratulation in the House. that it has done so well over these long weeks of debate. In my view, the debate has been a nightmare because we have seen a treaty which no one wants forced through the House by a Government determined not merely to have their treaty, but to have every comma and tittle in the Bill itself. We have heard congratulations to my noble and learned friend the Lord Chancellor, my noble friend Lady Chalker and others. I agree in welcoming their patience and courtesy because these have certainly been sorely tried.

One might think that we have had at least one enthusiastic speech today in favour of the treaty. That was from the noble Lord, Lord Richard. But his enthusiasm does not extend to voting for it, so that has to be written off as a momentary lapse.

The reason, I think, that our proceedings have been so disappointing is that Ministers have endeavoured to persuade us—the Prime Minister himself did the same on television at the weekend and other representatives of the Government have spoken in the same direction—that this is a jumping off point for a British view of Europe's future, not the treaty as interpreted by Brussels or by the Liberal Democrats, not a move towards a united states of Europe, but an opportunity for Britain to get its way. I have gone on hoping that they will be able to persuade me that this is something in which they themselves have confidence, but I find it very difficult.

The noble Lord, Lord Harris of High Cross, alluded to the point that Conservative Members of the European Parliament are now linked with the European People's Party—that is to say, with the Christian Democrats. The Christian Democrats of continental Europe, a perfectly respectable body, have a philosophy relating to Europe which is the antithesis of the policy which has been put before us by our Prime Minister and my noble friend Lady Chalker. They believe in a tightening of European links. They believe in the importance of deepening—as against broadening. They are not immune to protectionist feelings. They are a different body.

If the Conservative Members of the European Parliament whom we are going to be asked to re-elect next summer affiliate themselves with a body of that kind. I must ask my noble friend Lady Chalker two final questions. Is it with the approval of Her Majesty's Government? Do Her Majesty's Government accept that Members claiming to be Conservatives should be associated with continental European parties which wholly oppose the view of the future of Europe which Her Majesty's Ministers have been proclaiming? If my noble friend will say that there will be an instruction from party headquarters that they are to cease that affiliation I might, even at this last moment, be prepared to vote for the Bill.

Lord Pearson of Rannoch

My Lords—

Viscount Ingleby

My Lords—

Noble Lords

Pearson!

Baroness Trumpington

My Lords, order!

9.58 p.m.

Lord Pearson of Rannoch

My Lords, as I have been a sort of unofficial, unusual and clearly inefficient channel during these proceedings, I hope that it is in order for me to add my thanks to all my noble friends on the Front Bench and to all who have taken part in our debates. I cannot say that I agree with anything that my noble friends on the Front Bench have said, but I thank them most sincerely for the way that they said it and for the patience which they displayed.

Some of your Lordships have been surprised and, indeed, irritated from time to time by the length of some of the speeches of those of us who oppose the treaty. I hope that I can plead in some mitigation the fact that generally speaking we have met the 11 p.m. deadline which we traded with the usual channels in order to be given the extra days we felt we needed to get all our concerns on the record. I believe that that record will be useful as the Community develops, and I do not propose to repeat any of it now.

I wish to make only two points. One, I am -afraid, was inspired by the remarks of the noble Lord, Lord Bonham-Carter, this evening when he suggested that our motives in opposing the Bill were other than motives which we have purely because we believe in Europe and in the future of a successful Europe.

Therefore, I trust that your Lordships will forgive me if I repeat one thing which I said at Second Reading, which is that I am a good European. I do business in every European country, and have close friends in many of them, particularly in Italy, Belgium, Poland and Russia. So I have always supported the idea of a healthy European common market, but I do not believe that the people of Europe are ready for the kind of union which our politicians and bureaucrats now propose through ratification of the Treaty on European Union, signed at Maastricht.

My final point is a rather deeper one. During recent weeks, I have come to see that one of the questions which divides us is whether if enacted the Bill will increase the prospect of lasting peace in Europe, or whether it may eventually encourage conflict. I was particularly impressed by the speech of my noble friend Lord Whitelaw on Second Reading, as indeed I know were many other noble Lords. This evening the noble Lord, Lord Houghton of Sowerby, touched upon the subject with considerable authority.

I hope that it does not seem impertinent for someone of my generation—I was born during the last war—to raise the issue with my noble friend Lord Whitelaw and indeed with others of his generation, who fought in that war. I do so with the immense gratitude which ought to be felt, and trust is felt., by every one of us who has never had to fight a war, for the courage and sacrifice of the generation of your Lordships who rose to the terrible challenge posed to humanity by Nazi Germany, and who defeated it for we who came after. Many of your Lordships are owed that gratitude, and I trust that it is not out of place for me to record it now.

My difficulty is that I fear that the Treaty on European Union, signed at Maastricht, may be the engine of future conflict in Europe. And there, with much regret, I have to part company with my noble friend Lord Whitelaw. I fear that I may also part company with, among others, my noble friends Lord Carrington and Lord Pym and, most painful of all for me, with my noble friend Lord Charteris of Amisfield.

I do not think we can expect the French, the Germans, the Italians and ourselves., to name but a few, to tolerate the citizenship of the Union as envisaged by the treaty. Indeed, there are signs that the peoples of those countries are becoming more and more antagonistic to what the noble Lord, Lord Callaghan, confessed in one of our debates might be no more than a grand political vision.

It was an understandable and laudable vision when the noble Lord and others of your Lordships pursued it. Germany was rich and growing richer., and we wanted to be part of what looked like a more healthy economic environment than our own. Most of us never thought we would see the collapse of the Soviet Union in our lifetimes.

But the dream has faded. It was an honourable dream. It has served its purpose. But it is gone. Other trading blocs, particularly in the East, are setting sail. Germany and the other economies of the European Economic Community are faltering. Economic and monetary union as proposed by this treaty is unlikely to be attained. I think that my noble friend Lord Carrington admitted that on Second Reading. It has been admitted often since. As the ship of Europe sinks, she raises trading barriers against the peoples newly set free from Soviet tyranny.

There is no doubt that a substantial part of our sovereignty, and much of our political arid economic independence, has been ceded, or its cession is proposed, by the Treaty of Rome, the Single European Act and now the Union treaty. The British people, thanks to the decision in your Lordships' House last week, are not going to be asked if they agree. They may come to resent that decision very much. I appreciate that it was a decision taken in your Lordships' House and in another place.

I have to say to my noble friend Lord Cockfield and others, who have been so largely responsible for bringing us to where we are now, that they do not necessarily see the future very clearly, or even more clearly than some of the rest of us. Nor do those of your Lordships who fought in the last war bear all the credit for our past.

After all, over the last few hundred years, in their tens of thousands, in their hundreds of thousands, and in their millions, good British people have willingly given up their lives to create and to safeguard our system of parliamentary democracy and the absolute sovereignty of the Crown in Parliament.

I ask your Lordships to consider one question if you are thinking of supporting the Motion that this Bill do now pass. Do you think you will be honourably discharging your duty to that great sacrifice of the British people, made over centuries? If you have any doubt at all about the answer to that question, may I respectfully suggest that you join those of us who will be voting against the Motion.

10.5 p.m.

Viscount Ingleby

My Lords, I had hoped to speak on the amendment tabled by the noble Lord, Lord Blake, on Report, but was rightly dissuaded by the Government Chief Whip. I wish to take the opportunity of making plain my total opposition to the transfer of sovereignty from our Parliament to an ever-increasing number of European countries. If the Bill goes ahead would it not be far wiser for it to do so with the prior approval of the majority of the British people? To go ahead without that may be blowing up a mine of trouble for the future. I warmly commend the noble Lord, Lord Rees-Mogg, on the initiative that he has taken.

10.6 p.m.

Baroness Chalker of Wallasey

My Lords, this is the twelfth day of the debate on the Bill in this House and we are near the end of our work on it. I believe that your Lordships have clearly fulfilled the constitutional role that this House should play. We have given the Bill the detailed scrutiny which its importance has required. We have considered in detail more than 100 amendtnents—in fact, some of us worked on several hundred. I noted what was said by the noble Lord, Lord Richard, in his earlier remarks; what the Labour Party will oppose and how it will act in future. I wait to see.

However, your Lordships' endeavours on the Bill will enter the record books. I am told that never have so many Members spoken in a debate as they did on Second Reading and certainly never have so many voted as on the referendum amendment. That is a worthy tribute to the continuing role of your Lordships in our parliamentary democracy.

The Bill has demanded great labours of those who support us in our work. I am grateful to the civil servants who have briefed me and my colleagues on this Bench. I am also grateful to the clerks, to the attendants and to all the other officials of your Lordships' House for the support that they have given. I thank your Lordships, many of whom have made kind remarks today to me and my team. I offer my special thanks to all my ministerial colleagues, in particular my noble and learned friends the Lord Chancellor and the Lord Advocate and my noble friends Lord Ferrers, Lord Caithness, Lord Henley, Lord Ullswater and Lady Trumpington.

Noble Lords

Hear, hear!

Baroness Chalker of Wallasey

My Lords, despite the passions and the strong feelings that the Bill evokes our debates have generally been courteous and good-humoured. I understood the anxieties of some noble Lords to ensure that the Bill was fully debated. I admired their tenacity. In particular, I admired on occasions the noble Lord, Lord Bruce of Donington, when he sought to obtain the answers in one way or another. And he received them; I truly believe that he did.

I refer not only to noble Lords on the other side of the House, on the Cross-Benches and on the Liberal Benches but also to my noble friends behind me. There were occasions on which I did not welcome their comments but I should be untruthful if I did not admit that. Their demands were sometimes probing, often teasing, sometimes enigmatic and occasionally a little cynical. However, we on the Government Front Bench have made it absolutely clear that the policy of the Government is for Britain to be at the heart of Europe and that the Bill and the treaty keep us there. I am glad that the vast majority of your Lordships seem clearly to agree with me on that.

There is good reason for us to be very active in Europe; that is, active with partners and active in controlling the executive of Brussels. That is one thing to which I can certainly pledge myself as the Bill continues. I know that I shall have the help of the noble Lord, Lord Bruce of Donington, on many of the issues upon which we actually agree, even if we disagree about the Maastricht Treaty, the Single European Act and the Treaty of Rome.

Many questions have been asked of me tonight. There was one of which I had prior notice. I refer to the question posed by the noble Lord, Lord Moran. I believe that the noble Lord has now received a letter from my noble and learned friend the Lord Chancellor. However, as the hour is late I shall not go into the full detail involved. With the agreement of my noble and learned friend, I should like to place a copy of the letter in the Library. I believe that it contains a full answer to the noble Lord's question and one which I believe from the remarks he made earlier he accepts.

Despite the many hours of debate both here and in another place, I have heard no better policy advocated than the one which my right honourable friend the Prime Minister brought back from Maastricht; namely, a policy which enables us to ensure that the Community will assist and encourage the newly emerging democracies in Eastern and Central Europe. I believe that that is one of the most important tasks for the European Community in the years ahead. It is vital that we enlarge our Community to take in those EFTAn partners who have so long waited to be in a position to join us.

No one suggests that either of those objectives is central to the operation of the treaty. However, I believe that we must look forward. That is why I can give the noble Lord. Lord Jay, that assurance on the EFTAns, as, indeed, I did in earlier debates on the CAP reform. The common agricultural policy must be reformed and we shall reform it. I cannot perhaps agree with the noble Lord's third point; but I do not think that he would really expect me to in tonight's debate.

Put at its most basic, the Bill has shown us that the Community members will be able, post-Maastricht, to continue with many of the discussions which we have freely had over a long period of time but which need to be taken further. Indeed, we have had debates both at this stage and at earlier stages about what might happen in 1996. We must ensure that what happens in any future inter-governmental conference is what we wish to happen and that we agree with it.

There are many things which could be said tonight, but in approaching my final words I have a particular comment to make. Over 23 years I have watched the comings and goings of the Labour Party on Europe. In the old days it was either for or against it, whereas now its members are sometimes for when they think it may help them but they abstain whenever it suits them. The Government support the Bill and the treaty for a very sound reason. We do so because it is right for Britain and right for Europe.

In all the contributions that we heard in tonight's debate, the noble Lord who looked forward is probably the oldest among us. I am referring to the noble Lord, Lord Houghton of Sowerby, who looks forward to his 95th birthday next month. We wish him well. If someone at the age of 94, going on 95, can tell us that we should be looking forward in Europe and working for future peace and security, I am prepared to take his word for it. I certainly hope that your Lordships will do likewise. I commend the Bill to the House.

10.14 p.m.

On Question, Whether the Bill do now pass?

Their Lordships divided: Contents, 141; Not-Contents, 29

Division No. 3
CONTENTS
Ackner, L.	Boardman, L.
Addington, L.	Bonham-Carter, L.
Aldington, L.	Borthwick, L.
Allenby of Megiddo, V.	Brabazon of Tara, L.
Arran, E.	Braine of Wheatley, L.
Astor, V.	Brougham and Vaux, L.
Belstead, L.	Bulterfield L.
Birdwood, L	Cadman, L.
Blatch, B.	Caithness, E.

Campbell of Alloway, L.	Lindsey and Abingdon, E.
Carlisle of Bucklow, L.	Lockwood, B.
Carnegy of Lour, B.	Long, V.
Carnock, L.	Mackay of Ardbrecknish, L.
Carr of Hadley, L.	Mackay of Clashfern, L.
Cavendish of Furness, L.[Lord Chancellor.]
Chalker of Wallasey, B.	Mackie of Benshie, L.
Charteris of Amisfield, L.	Macleod of Borve, B.
Clark of Kempston, L	McNair, L.
Colnbrook, L.	Mancroft, L.
Craig of Radley, L.	Marlesford, L.
Craigavon, V.	Masham of Ilton. B.
Cranborne, V.	Milverton, L.
Cranbrook, E.	Monk Bretton, L.
Crickhowell, L.	Mountevans, L.
Cullen of Ashbourne, L.	Moyne, L.
Cumberlege, B.	Mulley, L.
Darcy (de Knayth), B.	Nicol, B.
De L'Isle, V.	Oxfuird, V.
Denton of Wakefield, B.	Park of Monmouth, B.
Dudley, E.	Perry of Southwark, B.
Eccles, V.	Perry of Walton, L.
Elles, B.	Platt of Writtle, B.
Elton, L.	Prentice, L.
Faithfull, B.	Reay, L.
Ferrers, E.	Renton, L.
Finsberg, L.	Rippon of Hexham, L.
Flather, B.	Robson of Kiddlington, B.
Fraser of Carmyllie, L.	Rodger of Earlsferry, L.
Fraser of Kilmorack, L.	Rodgers of Quarry Bank, L.
Gilmour of Craigmillar, L.	Russell, E.
Goschen, V.	St. Davids. V.
Grey, E.	Saltoun of Abernethy, Ly.
Hacking, L.	Sanderson of Bowden, L.
Hailsham of Saint Marylebone, L.	Sandys, L.
	Seccombe, B.
Harmsworth, L.	Seear, B.
Harris of Greenwich, L.	Sharples, B.
Hayhoe, L.	Sherfield, L.
Henley, L.	Shuttleworth, L.
Heskeih, L. [Teller]	Simon of Glaisdale, L.
Hives, L.	Slynn of Hadley, L.
HolmPatrick, L.	Stedman, B
Hood, V.	Stodart of Leaston, L.
Hooper, B.	Strathclyde, L
Hooson, L.	Strathmore and Kinghorne, E.[Teller.]
Houghton of Sowerby, L.
Howe, E.	Thomas of Gwydir, L.
Hylton-Foster, B.	Thomas of Swynnerton, L.
Inchyra, L.	Thomson of Monifieth, L.
Inglewood, L.	Tordoff, L.
Jeffreys, L.	Torrington, V.
Jenkin of Roding, L.	Trumpington, B.
Jenkins of Hillhead, L.	Ullswater, V.
Johnston of Rockport, L.	Vivian, L.
Kimball, L.	Wade of Chorlton, L.
Kinloss, Ly.	Wakeham, L.[Lord Privy Seal.]
Knutsford, V.
Lauderdale, E.	Walpole, L.
Lawrence, L.	Wigoder, L.
Lawson of Blaby, L.	Wise, L.
Leigh, L.	Wynford, L.
Lichfield, Bp.	Younger of Prestwick, L.
Lindsay, E.

NON-CONTENTS
Belhaven and Stenton, L.	Kilbracken, L.
Beloff, L.	Monson, L.
Bruce of Donington, L.	Moran, L.
Clanwilliam, E.	Morris, L.
Cocks of Hartcliffe, L.	Onslow, E.
Cross, V.	Pearson of Rannoch, L.[Teller.]
Dormand of Easington, L.
Galpern, L.	Radnor, E.
Gray, L.	Rankeillour, L.
Harmar-Nicholls, L.	Rees-Mogg, L.
Harris of High Cross, L.	Stoddart of Swindon, L.[Teller.]
Inglewood, L.
Jay, L.	Swinfen, L.

Tebbit, L.	Wharton, B.
Tonypandy, V.	Willoughby de Broke, L.
Wedgewood, L.

Resolved in the affirmative, and Motion agreed to accordingly: Bill passed.

10.22 p.m.

Baroness Trumpington

My Lords, in order to enable the completion of procedures for Royal Assent, I beg to move that the House do now adjourn during pleasure for 15 minutes. I suggest that we return at twenty minutes to eleven.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 10.23 to 10.40 p.m.]