HL Deb 27 June 1994 vol 556 cc546-60

4 p.m.

The Lord Privy Seal (Lord Wakeham)

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Prime Minister, about the European Council in Corfu.

"With permission, Madam Speaker, I will make a Statement about the meeting of the European Council which I attended with my right honourable friends the Foreign Secretary and Chancellor of the Exchequer.

"The Corfu Council put another three building blocks in place in constructing post-Communist Europe.

"First, the Treaties of Accession signed with Austria, Finland, Norway and Sweden will help create the wider Europe that we seek: a European Union that extends from the Atlantic to the Arctic. I warmly welcome the positive vote on accession in the recent Austrian referendum. I hope referenda in the other three EFT AN countries this Autumn will be equally successful.

"Secondly, we agreed in Corfu that the association agreements with our central and eastern European partners must be fully and urgently implemented. So should the UK-Italian initiative to link these countries more closely with the foreign affairs and home affairs pillars. This will help them to prepare for full membership of the European Union as soon as possible. Cyprus and Malta, too, will be involved in the next phase of enlargement.

"Thirdly, the European Union signed a part-nership and co-operation agreement with Russia-— one of the most comprehensive agreements ever concluded between the Community and another country. President Yeltsin said that the agreement symbolised Russia's return to the economic life of Europe as an equal partner. He also pledged the support of his government in bringing about stability in central and eastern Europe and his willingness to work closely over former Yugoslavia.

"Russia has just signed the Partnership for Peace Agreement with NATO, and on 9th July President Yeltsin will play a full part in the political debate at the Naples Summit. I warmly welcome Russia's increasing integration with western political institutions.

"In the discussion of the problems facing people throughout Europe, I suggested a series of moves to combat drug trafficking and other international crime. The drugs problem in Europe is growing. Enough cocaine has been seized in the European Union this year to provide 24 million individual doses. I pressed for more effective cross-border intelligence gathering on drug trafficking. I urged the Community to strengthen the Europol drugs unit and to set up the full European Police Office quickly, with a wide remit to tackle organised cross-border crime. I underlined the importance of action within our own countries. I suggested that the Union should hold a conference on drugs and organised crime, and should involve countries in central and eastern Europe.

"I was glad to receive wide support for these proposals, which were endorsed in the Conclusions of the Council.

"We made progress on two economic issues high on the British agenda. First, we agreed that markets in telecommunications and energy should be further liberalised, to give Europe's consumers access to wider, cheaper and more efficient services.

"Secondly, we strongly supported the German proposal to set up a European deregulation task force with businessmen as members, just as we have done in this country. This was agreed. The task force will help to cut back burdensome Community regulations on business.

"The Council endorsed the macro-economic guidelines drawn up by the Economic and Financial Council on the conditions for sustainable growth. We agreed that it was essential to continue cutting public sector deficits and reducing inflation. I reported that the British economy had grown by nearly 3 per cent. in the year to this Spring, and that unemployment had fallen here by over 300,000 since the end of 1992. Britain remains the fastest-growing of the big economies in the European Union.

"The Council approved a first priority list of 11 trans-European network projects. This includes the second Channel Tunnel rail link and proposals to improve the rail links between Northern Ireland and the Republic. Any contribution to the financing of such projects must come from within existing Community resources. At our insistence, the Council agreed that there could be no financial guarantee from the Community for trans-European networks. We believe that Europe's taxpayers must be protected against such open-ended commitments.

"We further heard evidence that the subsidiarity principle is being implemented successfully. We expect the number of main legislative proposals coming out of Brussels this year to be about half the number in 1993, and a quarter of the total four years ago. This is a very significant improvement.

"In external policy, the Council discussed Ukraine and agreed to step up support for economic reform and nuclear safety there, tied to the closure of Chernobyl. This discussion will be taken forward with the United States, Japan and Canada at the Economic Summit in Naples in early July.

"The Council once again discussed Bosnia. The Contact Group has done valuable work based on the European Union's plan; but there is an urgent need for the parties to show the will for a negotiated settlement if the process is to succeed. We agreed that the European Union would make every effort with the United States and Russia to bring the negotiations to a point of decision.

"Let me turn now to the Presidency of the European Commission. The treaty lays down that the Commission President should be selected by 'common accord' to serve a term of five years. Common accord is vital. For the President of the Commission to serve the whole Community effectively, he must enjoy the confidence and support of all of its members.

"Before the Corfu Council, we told the Presidency and other partners that we supported Sir Leon Brittan's candidature; and believed a genuine consensus of all 12 Member States to be essential. No-one disputed the latter point.

"When we heard that Mr. Dehaene was thinking of putting himself forward at a late stage, we privately informed the Belgian Government and other partners that we could not support him. We warned that it would not be possible for him to attract a consensus of the whole Community. We hoped, therefore, that his candidature would not be pressed.

"Neither then nor at any later stage did any partner say that either Sir Leon Brittan or Dr. Lubbers, the two long standing candidates, was unacceptable. Both, of course, had outstanding credentials and long experience of the Community —Sir Leon Brittan as a Commissioner for six years and Dr. Lubbers from 12 years on the European Council.

"At the Corfu Council, four states—representing nearly half of the Community's European Union's population—did not support Mr. Dehaene in the long discussion on the first evening. In several interventions, I made our strong views very clear to the Council, as I had in a number of bilateral discussions.

"On the following morning, Sir Leon Brittan and Dr. Lubbers decided to withdraw their candidatures. Other European countries indicated that they could accept Mr. Dehaene. I maintained my position that we could not. I said that I had given the matter careful thought and that our decision would not change at any stage. I reiterate that position in this House today. I suggested that consultations should be put in hand to find a candidate who had the support of all.

"The German Chancellor, who takes over the Presidency later this week, said that he hoped to resolve the matter quickly, if necessary by convening a special summit on 15th July.

"Our position was not a personal criticism of Mr. Dehaene, although in our view Sir Leon and Dr. Lubbers had much stronger qualifications. For the next five years the Commission needs a President who is in tune with the times and the mood across Europe—a President whose instincts are with enterprise and competitiveness. Above all, Europe needs a President of the Commission selected with the full approval of all member states.

"The Corfu Council has highlighted an issue of increasing concern to many European Union members: that issue is the way in which decisions are reached. It is an important point of principle that the key decisions require unanimity and that all member states should have an equal opportunity to participate in collective decision making. The procedures used for this decision, before and during the Council, were not satisfactory.

"There was no need for this matter to have come to an open division at a European Council. It should have been avoided. Had more comprehensive consultation taken place, as in the past, and had the views expressed by different states been heeded, it could have been avoided.

"I believe that there are a number of well qualified people who could take on this post, on the basis of a genuinely common accord. We stand ready to play our part in consultations on it. There is no reason why this should not lead to an early and satisfactory outcome.

"Madam Speaker, I want Europe to succeed. I want it to regain the affections of the people of Europe. I want a Europe with which all member states—soon to be 16, then 20—can feel comfortable.

"Achieving that may mean disputes along the way. But being a good European does not mean signing up to everything which our partners propose.

"At Corfu we fought for what we believe to be in the best interests of this country and of Europe. That, Madam Speaker, is what we will continue to do." My Lords, that concludes the Statement.

4.11 p.m.

Lord Richard

My Lords, like many conclusions following such meetings, the Statement falls into two parts. If I may, I shall address first the less controversial part before saying one or two things about the part that has created a certain amount of controversy. I have also noticed as regards such Statements that the contents of the Statement and the Communiqué do not necessarily coincide. Therefore, if one wants to get the full flavour of what was discussed one should carefully avoid relying solely upon what the Prime Minister says.

I received the conclusions about three-quarters of an hour ago. It is interesting that the Council spent an awfully long time discussing social affairs. It dealt with such controversial matters as the organisation of work, obstacles to part-time work, new forms of organisation of work, moving young people from education into work, and efforts to promote youth employment and to combat long-term unemployment, but there is not a word in the Statement about those. We must forgive the Prime Minister, however, because I understand that he was not even present for the discussions. Perhaps that is the reason why those matters were not included.

Of course, we welcome the accession agreements with the EFTA countries. We welcome the result of the recent Austrian referendum. We welcome the signing of the partnership agreement with Russia. We are glad that the Reflection Group now includes some Members of the European Parliament. I understood that the Government originally opposed that position. Of course, we support the trans-European networks. They may involve extra borrowing. I thought that the Government's attitude was somewhat over-negative towards that, but, again, if one reads the Communiqué, one sees that the position is perhaps not quite so negative as the Prime Minister has led us to believe.

The European Council greatly emphasised the social dimension. We support a great deal of what was said. Perhaps I should read just one sentence from the Communiqué, which states: Finally the European Council invites the Commission to renew its efforts … making full use of the new possibilities available in the Treaty on European Union and in particular of the provisions on the protocol annexed to it". So, the 11 are going to beaver away in accordance with Maastricht, and the British are going to sit outside watching them beavering away and no doubt complaining at the end of the day that they have not been properly consulted.

I turn now to the issue of the successor to President Delors. I am bound to say that my first reaction was;, "Well, here we go again. This is another foreign policy triumph for the Prime Minister". Once again, the Prime Minister has managed, with all the diplomatic skill for which he is becoming so famous throughout Europe, to produce the maximum amount of irritation with the minimum amount of political success.

It is worth asking ourselves—is it not?—what we set out to achieve and what we did in fact achieve. What was the object of the exercise? Was it to try to prevent a so-called "Federalist", whatever that may mean in this connection, becoming President of the Commission? If that was the object of the exercise, it was, on the face of it, unlikely to succeed. All the alternative candidates now being mentioned are very similar to Mr. Dehaene. They are all interventionists. They all believe in a strong and active Commission. They are all for a greater degree of integration in Europe. I am bound to say to the Government that if the result of this exercise is that they get Etienne Davignon as President of the Commission, they will have only themselves to blame for the amount of intervention that they will get from the Commission. I do not think that Mr. Dehaene was put forward because he has strong ideological views. He was put forward because he has a high reputation as a compromiser and a fixer inside his own country. He could hardly be otherwise, coming from Belgium and being the Prime Minister of that divided country.

We have succeeded so far in stopping one Belgian on somewhat spurious grounds. Are we to continue with a succession of vetos until we get someone we like? If that is so, the others may seek to exercise their rights of rejection too. Indeed, I can imagine nothing more damaging to any candidate than that he should now be supported by the British Government, such is the state to which our influence has now been reduced.

The Prime Minister said: For the next five years the Commission needs a President who is in tune with the times and the mood across Europe". What does that mean? It does not mean, in tune with the times and the mood across Europe"; it means, "in tune with the British view of the times and the mood across Europe". There is no doubt whatever that 11 of the 12 countries thought that Mr. Dehaene was, in tune with the times and the mood across Europe", otherwise they would never have backed him. When looking at this whole sorry affair, it is difficult to believe that the reasons set out in the Prime Minister's Statement are the real ones.

There are grounds for criticism—I accept them and join those making them—about the way in which France and Germany presented Mr. Dehaene's candidature. They were repeated in the Statement. But one then has to ask the next question because it is not sufficient simply to say that they should not have done it. The next question is: why was Britain not consulted by France and Germany? Why were we not part of that process? Is our position in Europe now so slight that Chancellor Kohl and M. Mitterrand no longer feel the need to take us into their confidence? At the heart of Europe? We are just about as peripheral now as a major power can possibly get. That is a tribute to the Tory Party's stewardship of the nation's affairs over the past 15 years!

The truth is that this farce was played out in Corfu not to accommodate any particular vision of a future Europe —I do not believe that for an instant—but to soothe the dissidents inside the Conservative Party. When the noble Lord, Lord Tebbit—I am glad to see him in his place—and Mr. Lamont, let alone Sir James Goldsmith, approve of the Government's European policy, it is time for all sensible men to think and ponder well.

The Financial Times put it correctly and succinctly this morning when it stated: Unfortunately, one is forced to conclude that the veto was no more than an improvised and futile gesture to Tory Euro-sceptics —futile since no Commission candidate who would command a consensus on the continent is likely to attract their support, and the party's civil war over Europe can now only deepen". I gather that already the Euro-sceptics in the Tory Party are demanding that the Prime Minister vetos any other "Federalist" candidate of whom they disapprove.

Mr. Major picked this quarrel himself on dubious grounds. He chose the corner and the colour of the paint, and he painted it himself. He has persisted in it and is still persisting in it with all the obduracy of a fundamentally weak man. He has succeeded in antagonising precisely those countries that we shall need in the future. In reality, he has done it for the sake of a few cheap plaudits from the irreconcilables in his own party. I find it deeply shaming.

Baroness Seear

My Lords, we on these Benches thank the noble Lord the Leader of the House for repeating the Statement. Like the noble Lord, Lord Richard, we too can go along with many of the points that were made at the beginning. Clearly, we welcome the accession of Austria, Finland and Norway, and the second and third items which were reported and dealt with at the conference.

We note also the position of Russia and the fact that Russia has now signed a peace agreement with NATO. We welcome the full part that Russia is now playing. However, I should like to ask the noble Lord about the attitude of the Eastern European countries, the former members of the Warsaw Pact, who have some anxieties about the position of Russia in relation to the western world. Have they been consulted? Have they anything to say about what is happening? Are we considering their interests as well as the interests of Russia?

We welcome, too, the two economic issues: they are the markets in telecommunications and energy and the European deregulation task force. We note that that task force will have businessmen as members, as was the case in this country. There is nothing wrong with that, provided that there are other members who are considering other aspects of deregulation. I give as an example the social issues that are connected with deregulation, which can be seriously affected by it. Who will speak on and look after those issues? Will people who are competent to speak in that regard be included in the task force which is to deal with European deregulation?

We welcome the remarks about Bosnia and Russia's relations with it. But, of course, what is of concern is the issue of the presidency. We agree that not necessarily is Mr. Dehaene the most ideal person to be the new President of the Commission, but that view may well be open to challenge. We agree, as did the noble Lord, Lord Richard, that the way in which his name emerged was far from satisfactory. France and Germany getting together to put forward their candidate was not in accordance with the requirements of the treaty. It requires consultation with all members of the Community, which did not take place. Moreover, the Maastricht Treaty requires that there should be consultation with the European Parliament. The new Parliament, with its added powers, is meeting in July. Can we have an assurance from the noble Lord the Leader of the House that the Parliament will be brought into the consultations, as required by the Maastricht Treaty?

What an extraordinary situation we now have in front of us. The Prime Minister has talked himself into a corner in which he is in opposition to all the other 11 member states. The noble Baroness, Lady Chalker, shakes her head. There is no question but that, whatever may have been the case during the discussions, ultimately none of the other 11 members supported the position taken up by the Prime Minister in Corfu. How can that possibly be to the benefit of the United Kingdom?

There are important issues to be decided, in particular at the inter-governmental conference in 1996. Before that meeting surely it is of the greatest importance to develop alliances and friends with whom we can discuss the issues that are of importance to us. We must be able to rely on obtaining collaboration in putting forward the issues that we wish to defend. However, after talking ourselves into such a corner, where will those friends come from? What kind of impact can we possibly have in 1996 if we are continuously seen as being the odd man out, the enemy of the development of Europe, based on a totally faulty idea of what federalism is all about?

This is to isolate Britain. It is extraordinary that we should claim that we are aiming to be at the heart of an organisation when we are locked in seemingly endless strife with the other 11 members of that organisation. Is that the way to get to the heart of any organisation? Is it the way to have any impact and effect on the way in which that organisation will develop and affect in many vital ways the future of this country, as it is bound to do?

4.24 p.m.

Lord Wakeham

My Lords, saying that I am grateful to the noble Lord, Lord Richard, and the noble Baroness, Lady Seear, for the questions that they have raised does not indicate that I accept all that they have said. I accept that they have raised important and significant questions and I shall do my best to answer them. I need not delay too long on the first part of the Statement, on which the noble Lord commented, because there is a great deal of common ground on that. However, there are one or two comments that should be made.

It is not true that the British representatives—my right honourable friend the Prime Minister and his right honourable friends the Foreign Secretary and the Chancellor —did not play a full part in the discussions on competitiveness and employment. Indeed, much of Friday afternoon and Saturday morning were taken up with those issues. The Council welcomed the evidence of economic recovery across Europe. However, it reaffirmed the need for structural reform, more flexible labour markets, better training and education and the cutting of European red tape.

We fully support the conclusions of the European Council that obstacles to part-time work should be removed and that it is important to find ways of tackling youth unemployment. Indeed, on both those issues the United Kingdom has one of the best records in Europe.

The noble Baroness, Lady Seear, commented on the attitude of the former Warsaw Pact countries—the Eastern European countries. They were kept closely in touch with everything that was going on. The European Council spent a considerable time discussing those countries and the conclusions contain a number of proposals for strengthening the relationship with them and preparing them for membership. There is no reason to suppose that the Eastern Europeans oppose what has been agreed at Corfu.

The noble Baroness was also right to stress the fact that, in moves in this country and in Europe, in many cases deregulation has two sides to it. The first is the lifting of burdens on business and the second is the necessary protection of consumers. It is vital both here and in Europe that we identify the burdens and that is where we believe that the use of businessmen is particularly valuable and important. It is, as in this country, finally the job of Parliament to decide whether those burdens are rightly to be changed, whether they cease to have a valuable role or whether they should be moved in some other way. I agree with the noble Baroness that, while we defend the idea of using businessmen to help us with that task, there is the other side, which is most important.

With regard to the presidency of the Commission, the position is simply that, as the noble Baroness and the noble Lord agreed, the Prime Minister used our constitutional right to a veto and prevented the appointment of a candidate whose views in several respects run counter to our key strategic interests. We believe that Mr. Dehaene stands for ideas about interventionism and the gradual pushing of power to the centre of Europe, which we believe are out of date. We simply did not believe that he was the right person to be the chief manager for the next five years of a European Union. We made that clear at the outset. It is not a personal matter or an issue of nationality. We believe that the issue should have been dealt with by arriving at a candidate who could be supported by all members of the Community.

There have been a number of so-called crises in the history of the European Union. Compromises were eventually found. This occasion should be no different. Britain has often taken a stand of principle which has attracted criticism at the time, but which has resulted in satisfactory outcomes; for example, our budget rebate, our Maastricht opt-outs and our rejection of the Dutch presidency's federalist blueprint before Maastricht. Over the years, we have helped to shape the European Union agenda in key respects: for example, on the assistance of budgetary restraint; on the drive for the single market; the acceptance of enlargement; the new principles of subsidiarity; intergovernmentalism; and, most recently, the drive for deregulation and competitiveness. Therefore, we make no apology at all.

It is interesting that that was a major issue during the recent election campaign. The Conservative Party made it clear that it felt that both the Labour Party and the Liberal Party would undermine our national veto. Their reactions to our use of the veto in Corfu bears out that point. It is to stand logic on its head to imply that Britain has influence in Europe only when it accepts the decisions of our partners.

At the next stage—and we shall play a full part in that —it falls to the new German presidency to find a candidate for the Commission presidency who is acceptable to the 12. The population of the European Union amounts to some 360 million people. It should be perfectly possible to find a candidate who will attract unanimous support. The Germans have already made it clear that the problem should be sorted out quickly. Their aim is to present the new president designate of the Commission to the first plenary of the new European Parliament on 20th July. We shall play our full part in that.

4.33 p.m.

Lord Tebbit

My Lords, would my noble friend not agree that it is unfortunate at the very least for one member state to find itself isolated by reason of its obduracy, by its refusal to countenance complying with its obligations and by persisting in policies which have the complete disapproval of all other member states? Will my noble friend tell me what pressure was put on Greece to cease its disgraceful behaviour towards the state of Macedonia in which Greece has been indulging now for some months past to the entire disapproval of all other member states in the Community?

Secondly, does my noble friend not agree that having heard the voice of the noble Lord, Lord Richard, relayed, perhaps, from his years in Brussels, we should remember that the doctrine of appeasement within the European Community is far from dead?

Lord Wakeham

My Lords, my noble friend makes his points in his own way. Of course, he is absolutely right. The European Council and the Foreign Ministers have said repeatedly that the position with regard to Greece and Macedonia is unsatisfactory. They are seeking to bring pressure to bear to resolve that problem.

It should not be thought that for Britain to take the view that it did is anything novel or new in the European Community. I can remember not very many months ago the French being extremely difficult over the GATT negotiations; but that does not make them any less European. I can remember only days ago—and I do not know whether the problem has yet been resolved—the Italians being very difficult with regard to budgetary matters because they do not approve of the milk quotas. This country is entitled to stand up for its interests and while this Government are in office, they will stand up for them.

Lord Barnett

My Lords, I have always tried to persuade friends that the noble Lord, Lord Tebbit, is nothing like as nasty as he always sounds—although I hasten to add that that is usually without success.

Of course the Prime Minister was perfectly entitled to veto what the other 11 wanted. Nobody disputes that. The question now is whether the Prime Minister intends to veto any other candidate whom he assumes to be federalist. Will the noble Lord give us a definition of what European federalism really means to the Prime Minister and to the Government? Does the Minister accept that it may mean more and not less subsidiarity? In those circumstances, why should the Prime Minister oppose somebody who necessarily, on the Government's definition, is assumed to be a federalist?

With regard to interventionism, is it not a fact that the Council of Ministers is the supreme body? If the Commission seeks to be too interventionist, it is perfectly open to the Council of Ministers to oppose that.

Lord Wakeham

My Lords, the noble Lord is right to say that the Council of Ministers has a great say and, in a sense, disposes of many of the issues. But that should not mean that the position of the new president of the Commission, who will be president for five years and perhaps longer, is not extremely important. Those five years will see dramatic changes within the European Union. The direction of that change has become increasingly apparent. We should like to have a president who will sustain rather than retard that movement. We shall not enter into further negotiations with any desire to veto anybody. We shall seek to discuss with our colleagues in Europe a candidate who is acceptable to all member states, and I believe that that is possible.

Lord Beloff

My Lords, does my noble friend the Leader of the House agree that once again the noble Lord, Lord Barnett, speaking from the Labour Benches, is trying to obscure matters by his play with the word "federal"? In the minds of some continental philosophers it may mean less than central government. Mr. Dehaene and people who think like him—and this can be found in every recorded speech that he has made —are in favour of what is called further European integration; that is, more laws made in Brussels and fewer laws made by national parliaments.

Mr. Dehaene would not deny for a moment that he takes that line. Do not Her Majesty's Government believe that while may have corresponded with the feeling in Europe that 10, 15 or 20 years ago, the recent European elections—both the voting and the number of abstentions in many countries, as well as other evidence —show that that is wholly out of date? Therefore, one is looking for a president who understands what is going on now and who will not repeat the litany of M. Monnet a generation ago.

Lord Wakeham

My Lords, my noble friend makes his point extremely clearly. I did not use the word "federalist" and I do not use it because I agree that it opens up a new discussion about what it means. We said that Mr. Dehaene stands for ideas about interventionism and the gradual pushing of power to the centre of Europe. We believe that those ideas are out of date. We wish to find a candidate who we believe has a feel for how Europe will be during the next five or 10 years.

Lord Bruce of Donington

My Lords, we seem to have got ourselves into a lot of trouble even though a year ago we were busily examining the Maastricht Treaty. I am given to understand that Members of the Government at that time, after tuition at Conservative Party headquarters, understood what was in it.

We are in the trouble that we are because we still have not read the treaty. It may be helpful to remind your Lordships that Article 158(2) of the treaty states: The governments of the Member States shall nominate by common accord, after consulting the European Parliament, the person they intend to appoint as President of the Commission". Everybody seems to have forgotten the word "after".

The European Parliament is not in session until 15th July. It has not yet selected its committees, although I am quite sure that the committee which deals with pay and allowances will be one of the first to meet! But the European Parliament still has to determine a definitive attitude towards that most important problem. Indeed, that is right. As the Government say—I am quite sure that my noble friend agrees—the choice that is made as regards the President of the Commission is of crucial importance in the years that lie ahead, particularly in the year 1996 when the inter-governmental conference takes place. This is why the Corfu proceedings were entirely meaningless. The European Parliament had not been consulted and the views that the population of Europe have put forward to their various European Members of Parliament were not known. It will probably take some six weeks to two months for the European Parliament to articulate its views, bearing in mind that shortly after it assembles on 15th July it will depart for two months recess.

Where are we on this? Surely the main trouble is this; that Germany and France—I am not afraid to mention this —decided which way they wanted to go and they sought, by using what power they have in terms of the influence that they wield economically and financially in Europe, to railroad the rest of the Community into supporting the candidate of their choice. I do not think it was right to do so. If I were in a Labour Government I would not be railroaded. I would follow the procedure laid down in the treaty itself with which I have acquainted the House. It may well be that the Parliament would reach a conclusion that was not amenable to me —maybe I would disagree with it—but at least the procedure would be followed. It should have been followed in this particular case.

Lord Wakeham

My Lords, I do not think I need go into quite such a wide survey of the scene as did the noble Lord, with his enormous knowledge of these matters. But the position is quite simple. The European Council has first to agree a nominee before it can put a name to the European Parliament. The discussions, as I understand it, at Corfu were to seek to agree a nominee to put to the European Parliament. There were three candidates on the table, so to speak, of which two were not objected to in terms of a possible veto by anyone. There was one candidate who, it was made abundantly clear, was unacceptable to one member state. As there has to be unanimity, we ended up, unfortunately, in the position we are in and we shall have to get out of it for the next time. However, I am sure the British Government did the right thing.

Baroness Elles

My Lords, is my noble friend aware of the very great support and admiration we have for the Prime Minister, who took his action at Corfu to protect not only British but European interests? Is it not recognised that even if Mr. Dehaene was a very suitable candidate to be President of the Commission—there are indeed doubts as to his political views—in view of the fact that he would be President of the Commission for five years, that would have influence on the whole of the future of the European Union? Is it not time that people realised that, particularly the Opposition, who seem to have been ready just to be dominated by a decision knitted and cobbled together by the German and French Governments? Is not that an intolerable situation? Should we not support the Prime Minister in standing up, as I say, for British and European interests?

Lord Wakeham

My Lords, I am most grateful to my noble friend for that question. She is, of course, absolutely right. There was considerable unease in most other delegations about the way this matter had been handled and the way people's agreement had been taken for granted. Others expressed doubt there, and I see from this morning's press that others have expressed doubt since. I hope there is a lesson for all of us in this and that at the next meeting we find a candidate, who under the rules has to be unanimously agreed. That is the way forward.

Lord Rodgers of Quarry Bank

My Lords, there is a puzzling aspect of the story and I hope the noble Lord the Leader of the House can help us to see it more clearly. It was plain from an early stage that the Government's own candidate, Sir Leon Brittan, whatever his merits—I would not attempt to suggest he does not. have them—was not a candidate who would gain support. It is not really sufficient to blame a major defeat for British diplomacy on other countries' bad behaviour. Why did we not take an initiative much earlier and look for a candidate who would meet exactly the criteria which the noble Lord the Leader of the House and the Prime Minister have indicated; in other words, a candidate who would be a candidate of consensus? Why did we not take an initiative and find someone to put forward, because at the end of the day the failure of our diplomacy was marked by the withdrawal of the two other candidates, including Her Majesty's Government's candidate, who had only three supporters at the best of times?

Lord Wakeham

My Lords, I must say that I do not consider it to be a defeat to stand firm for British interests as we did on this occasion. I think it would have been a defeat to have gone along with some candidate who we did not think was acceptable. The position is that we supported Sir Leon's candidacy because we thought he was highly suited to the job. We also recognised that Dr. Lubbers was a strong candidate, and no other country thought that either of them was; unsuitable as a possible President of the Commission. We made it clear that the Belgian Prime Minister was unacceptable to us, and that was the difficulty we found ourselves in at Corfu, with the consequences that we all know about.

Lord Merlyn-Rees

My Lords, following what the noble Lord has just said, what will happen now? Is it not right that the names, or the name, that the Government are going to put forward should be known to all of us? If it is a matter of the European Parliament playing a part in this, why not us? The noble Lord has reported to this House; we have heard about names being bandied about. Why should we not be able to discuss the name of a person that is to be put forward? I wish to ask one other question. This morning I listened to the "Today" programme—I never listen to it for very long but I listened to it this morning—and I heard the Home Secretary say that this was not just a matter of choosing a President. He said that there is a turning point and that this matter constitutes a movement of the European Community towards a free trade area. That is what he said. Was he speaking on behalf of the Government?

Lord Wakeham

My Lords, the noble Lord, whom I have known for many years, occasionally puts on an appearance of innocence which never convinces me and which does not convince me this afternoon. If he seriously thinks that any candidate which the British Government consider to be a suitable President should be—I hope your Lordships will not feel I say this in any disrespectful fashion—bandied about in your Lordships' House this afternoon, I do not think that that would necessarily improve his chances of being elected. We believe the way to select a President of the Commission who is acceptable to all the members of the Community is to go about it with quiet diplomacy, and that is what we shall do under the leadership of the German Presidency.

Lord Monson

Does not the noble Lord the Leader of the House agree that it is most regrettable that the official Opposition—or at any rate their Front Bench —see fit to attack Her Majesty's Government for having the guts to stand up to what, by common consent, was Franco-German bullying; in standing firm not only for our own sake but for the sake of a number of smaller countries whose views, secretly, are rather closer to our own than they are to the views of France, Germany or Belgium?

Lord Wakeham

My Lords, I am entirely content when the Opposition are attacking the Government. I get myself into some anxiety when I receive too much support from the noble Lord, Lord Richard, opposite. Therefore I am perfectly content that he should be attacking the Government in this way. But I think he is wrong for the reasons that I have said.

I believe the noble Lord made a good point. It perhaps is less difficult for a major nation like the United Kingdom to stand firm on these occasions. Some of the smaller countries of the European Union perhaps find it less easy to stand firm. Therefore it is the decision-making processes within the Community that we believe to be an important part of the lessons that should be learnt from these events.

Lord Howell

My Lords, may I—

Lord Pearson of Rannoch

My Lords, a sceptic voice from these Benches can add to the congratulations of my noble friend Lady Elles to the Prime Minister on the stand that he has taken—I think, and many of us think, with considerable courage—on this matter of the Commission President. In regard to the point of the noble Lord, Lord Richard, about there being other candidates who may be just as bad as Mr. Dehaene, I for one hope that my right honourable friend the Prime Minister will veto them until we get a candidate who is acceptable to all European Governments.

My main question to my noble friend relates to the early part of the Statement, in which my right honourable friend the Prime Minister was glad to welcome Austria and hoped soon to welcome three more countries to make the Community number 16 and then to move on to 20 in due course. Some of us have a worry that if this process takes place the strength of the centre of the Community—the Brussels bureaucracy which many of us dislike so much—will be strengthened by a widening of the Community. Most of us support widening because we hope that it will lead to a weakening of the centre. Has my noble friend the Leader of the House anything to say on that fear? I look forward to hearing what he has to say.

Lord Wakeham

My Lords, I thank my noble friend warmly. I am delighted when he supports the Government on European matters, as opposed to my lack of concern when the noble Lord opposite disapproves of what I have to say. I believe that the accession of the four additional members of the European Union—which I very much welcome—will produce a Community which will be very different in character from the type of central, interventionist Community which was developing until my right honourable friend played a large part in arresting that movement. I believe that that will be even more so when the Community is enlarged to 20 members. I do not want to tempt my noble friend too much, but that is why a number of us believe that the Maastricht Treaty was such a significant event in the development of the European Community.

Lord Howell

My Lords, having regard to the fact that the European Union has as one of its principal purposes economic advance, about which little has been said today, and the silence of the leaders of British industry, which has such fundamental trade with Europe, what discussions have the Government had with British industry and what assessment have they made of the effect of the continuing isolation of our Government, not only on this issue but on all recent important issues? Has the noble Lord read the statement made by Chancellor Kohl this weekend about future economic planning, which will require full co-operation and participation in regard to workers' rights in drawing up economic strategies? Judging by the assessment in The Times today, we have again lost on this vital question. What assessment have the Government made about the need for economic advance on these matters, on which we are also at odds with our 11 partners?

Lord Wakeham

My Lords, I think that the noble Lord is wrong about that. As a result of the Copenhagen and Edinburgh summits and the most recent summit the British Government's agenda on economic affairs has now been widely accepted throughout the Community as the right way forward. That agenda includes improved competitiveness, labour market reforms, the importance of keeping down inflation and the control of public sector spending. All of those issues are issues on which the whole of the European Community has now united behind the British initiative. We are right at the centre of the developments taking place within the Community.