§ Lord Pearson of Rannoch asked Her Majesty's Government:
§ Whether they consider that, were the United Kingdom to implement all the provisions on economic and monetary union in the Maastricht Treaty, this would lead to political union with Europe.
§ Lord InglewoodMy Lords, the Government do not believe that the implementation by the United Kingdom of the provisions on economic and monetary union would lead inevitably to political union.
§ Lord Pearson of RannochMy Lords, I thank my noble friend for that reply which I find somewhat difficult to reconcile with Article 105 of the Maastricht Treaty and Article 12 of the Protocol on the European Central Bank which, between them, give up our control of interest rates, cede our ability to print our own currency and give away our sovereignty over the holding and management of our foreign reserves to unaccountable foreign bankers in Frankfurt. Therefore, can my noble friend give the House an assurance that we will never lose the freedom to tax and to spend? Surely, my noble friend must agree that all these powers are such well-established and longstanding hallmarks of our sovereignty that to lose them would be to lose our political independence.
§ Lord InglewoodMy Lords, the Government guard very jealously their fiscal powers. They do not intend to take any steps which would in any way erode our sovereignty in these matters.
§ Lord Boyd-CarpenterMy Lords, does not my noble friend find it very difficult to deal with this immensely complex and important matter by way of an Answer to an oral Question?
§ Noble Lords, Hear! Hear!
§ Lord InglewoodMy Lords, my noble friend is absolutely right in his analysis. It is an extremely complicated matter.
§ Lord Hamilton of DalzellMy Lords, does my noble friend agree that the currency is primarily a means of trading the country's wealth and belongs to the inhabitants of this country and not to the Government? Does he further agree that it will have to be pooled in order to create a single currency and that the sterling bank note is a promissory note issued against that wealth? Can my noble friend tell the House what the mechanism will be for seeing that the wealth of the British people is not used to finance the debts of other 572 countries which have joined a single currency or indeed for preventing the country incurring the debts of the citizens of those other countries?
§ Lord InglewoodMy Lords, my noble friend raises a number of extremely hypothetical matters. The Government have not the slightest intention of allowing any of the things he has described to happen.
§ Lord Hailsham of Saint MaryleboneMy Lords, next Question!
§ Lord Stoddart of SwindonMy Lords, we have another five minutes to go before the next Question. Does the noble Lord agree that this is a profoundly complex and important question? Despite the noises from behind the noble Lord, it is right and proper that this House should explore all the implications and possibilities of economic and monetary union. Does he agree with his right honourable friend the former Chancellor of the Exchequer that economic and monetary union has profound political implications for this country? Since he actually read the treaty and the present Chancellor did not, is he not more likely to be correct than the present Chancellor?
§ Lord InglewoodMy Lords, almost surprisingly, I find myself in a great deal of agreement with what the noble Lord, Lord Stoddart of Swindon, says. As already mentioned, this is an extremely important matter. I do not believe that anyone will dispute that it has very significant political implications. That is why on many occasions in this House and in the other place, and doubtless on many occasions in the future, this matter will be debated in considerable depth and at length.
§ Lord Thomson of MonifiethMy Lords, given the present turbulence in the world currency markets, would it not be an immense advantage to a trading nation like Britain to have the stability of a single European Union currency if the conditions are right?
§ Lord InglewoodMy Lords, it is clearly to the benefit of a country such as ours that there should be stable currencies, as it is for all countries. The disagreements that there may be among us no doubt relate to the methods of achieving that.
§ Lord BoardmanMy Lords, does my noble friend agree that monetary union, as envisaged by the Maastricht Treaty, must inevitably lead to an element of fiscal union? Is that not one reason why the Government are so wise to keep their options open?
§ Lord InglewoodMy Lords, I thank my noble friend for his question. It seems to be both the most intelligent and sensible approach to see what this is all about and to take a decision at the appropriate moment on what we want to do.
Lord Bruce of DoningtonMy Lords, I appreciate the desire of the Government to defer making a decision on political union until they have read the papers, which one hopes they will do in due course. Will the 573 Government bear in mind the existing situation where we are operating, possibly unknown to them, under bureaucratic union?
§ Lord InglewoodMy Lords, in reply to that question, I should like to make it clear that the Government's position on political union is absolutely clear. We do not want it and we are not going to participate in it.
§ Lord Lawson of BlabyMy Lords, does my noble friend agree that one thing at least is clear; that those who put forward the idea of monetary union in the first place did so entirely for political purposes? Secondly, does he agree that one thing is unclear? I refer to how the Official Opposition can be against the idea of an independent central bank in principle if it is British but in favour of an independent central bank if it is European?
§ Lord InglewoodMy Lords, I thank my noble friend for his comments with which I concur. On his second point, I find it difficult to see how those views tie together, but the duty to explain that is not mine. It is that of the Opposition.
§ Lord EatwellMy Lords, will the noble Lord tell the House—
§ Lord Jenkins of HillheadMy Lords—
The Lord Privy Seal (Viscount Cranborne)My Lords, I intervene with the greatest reluctance between two such distinguished spokesmen. I wonder whether the noble Lord, Lord Jenkins, will allow the Official Opposition to speak first.
§ Lord EatwellMy Lords, will the noble Lord tell the House whether it is the Government's view that, should Britain join a monetary union, the Government's control of monetary policy would be increased or diminished?
§ Lord InglewoodMy Lords, that would depend on the circumstances at the time. It is one of the matters we shall be taking into account when we consider whether or not to join at whatever moment that decision has to be taken.
§ Lord Jenkins of HillheadMy Lords, as the noble Lord completely rejected the whole concept of political union a very short time ago—admittedly, it is not a wholly precise concept—will he explain how the Government reconcile that with their commitment to an ever-closer union to which they subscribed in treaty after treaty—from Rome to the single market—long before Maastricht?
§ Lord InglewoodMy Lords, the concept of "political union", as that phrase is commonly used in this country, is understood by the Government to mean the creation of a single European state. That is not what is referred to in the preambles to the treaties.
§ Lord MolloyMy Lords, will the Minister confirm that if the Government were to consider in future that it might be necessary to adopt some of the aspects of 574 economic and monetary union this House would be provided with opportunities to comment thereon before such action was made official?
§ Lord InglewoodMy Lords, I can confirm that with absolute certainty.