HL Deb 30 January 1997 vol 577 cc1243-6

3.13 p.m.

Lord Wallace of Saltaire asked Her Majesty's Government:

Whether the inclusion of the principle of flexibility in the proposed treaty to amend the Treaty on European Union will work to the United Kingdom's advantage rather than its disadvantage.

The Parliamentary Under-Secretary of State, Department of National Heritage (Lord Inglewood)

My Lords, the Government believe that the European Union should be able to respond more sensitively to the needs of an increasingly diverse membership. Although it is too soon to prejudge the outcome of the IGC, any eventual flexibility arrangements must be tightly circumscribed. In particular, such arrangements must be agreed by all.

Lord Wallace of Saltaire

My Lords, I welcome the Minister's definition that the flexibility clause needs to be tightly circumscribed. Does he agree that since the Prime Minister floated the concept of flexibility in his Leiden speech, its definition has largely changed to one in which other governments wish to use flexibility to leave Britain out, rather than to allow us to opt in? Does the Minister also agree that the French definition of "enhanced co-operation" as the way we move forward takes us towards a core Community from which Britain would be left out? That is clearly against the interests of this country.

Lord Inglewood

My Lords, the noble Lord is quite right to point out the mutation that has taken place in the way in which the concept of flexibility has been used. We advocate flexibility by consent so that any agreement would be agreed by all and open to all; and there would be no discrimination. Certain others have approached the matter in a different way, seeing the concept of flexibility as a way of blazing a trail and to hijack the wider, better, proper definition of "flexibility", turning it into a characteristic so that those outside it would be treated as second class. We cannot accept that.

Lord Clark of Kempston

My Lords, is the Minister aware that it is essential to keep flexibility because if we lose it we could lose the argument about the social chapter and the minimum wage? If either of those were to happen, it would kill the competitive position of industry in this country.

Lord Inglewood

My Lords, my noble friend is quite right to point out that flexibility is already enshrined in the workings of the Community in the social chapter. The arrangement that was negotiated at Maastricht was accepted by all member states.

Lord Richard

My Lords, may I congratulate the Minister on producing, if I may say so with respect to him, as uninformative a series of answers as I have heard in either House over my 35 years in politics? He said nothing and he said it quite loudly. Perhaps I may ask two questions. I gather that flexibility is to be reinterpreted as sensitivity. In those circumstances, can the Minister tell us what it is that the union should be flexible or sensitive about? What principles should govern the exercise of that flexibility or sensitivity? In what circumstances should it be applied? Are countries expected to be more sensitive and more flexible?

As regards the Minister's answer to his noble friend Lord Clark, will he deny the implication of that answer? It is that we will be flexible when it is in our interests to be so, but we shall not be flexible when it is in anyone else's interests for us to be flexible.

Lord Inglewood

My Lords, I am most grateful to the noble Lord, Lord Richard, for offering me congratulations. It does not happen all the time. In the run-up to the IGC, no one can know what conclusions might be reached at the meeting. We have not tabled any proposals at the IGC about flexibility; it is merely an idea that was first raised by the Prime Minister some two years ago at Leiden. More recently, the Prime Minister spoke to Mr. Wim Kok, President of the Council, on the topic earlier this year. In formulating this approach, it is a matter of trying to ensure that if flexibility is introduced further into the workings of the Union, the interests of non-participants are given proper consideration.

Lord Barnett

My Lords, I recognise that flexibility has now become "a many-splendoured thing". However, in the Government's view, is it flexible enough to reconcile the views of the Prime Minister, the Chancellor of the Exchequer and the Deputy Prime Minister in respect of a single currency? The Deputy Prime Minister and the Chancellor have made then-views crystal clear; namely, that the "wait-and-see" policy remains. But in that well-known magazine the New Yorker, the Prime Minister is quoted as saying that if he were Chancellor, he would not like to come to the Dispatch Box and say, if interest rates had gone up three points, "I'm sorry, but it's no fault of mine, guv". I quote his words. In those circumstances, the Prime Minister agreed that it meant that in principle you could not go in. That is clearly not the same as what was said by the Chancellor of the Exchequer and the Deputy Prime Minister.

In those circumstances, would the Minister care to tell the Prime Minister—and he can afford to do so now because he will not be there much longer—that in any event, in or out of the single currency, a Chancellor of the Exchequer would have little real room for manoeuvre on interest rates? Would the Minister care to reconcile the different views?

Lord Inglewood

My Lords, the Government's position on the matter is both clear and consistent. I should be delighted to pass a message to the Prime Minister that the noble Lord has some comments that he would like to draw to his attention.

Lord Wright of Richmond

My Lords, does the Minister agree that whether the concept of flexibility is to our advantage or disadvantage, what is undoubtedly to our disadvantage is the increasing impression being given to our partners that the European Union is some foreign body of which we are not members, of which we do not wish to be members and which we cannot and do not wish to influence?

Lord Inglewood

The noble Lord, Lord Wright, is quite correct in his appraisal of the position. It is not the Government's policy to give the impression that he has described.

Lord Pearson of Rannoch

My Lords, is my noble friend aware that many of us would wish to congratulate the Government, if, in their interpretation of the expression "flexibility", they are determined to avoid any weakening of the veto?

Lord Inglewood

My Lords, there is no direct link between the development of the ideas inherent in the concept of flexibility and the weakening of the veto.

Baroness Farrington of Ribbleton

My Lords, is the Minister prepared to tell the British public whether the Government intend to exercise their flexibility on the issue of the national minimum wage and inform them of the rapidly soaring public subsidy to employers who pay below subsistence wages?

Lord Inglewood

My Lords, it is not the policy of the British Government to have a minimum wage, and there is nothing more to be added.

Lord McNally

My Lords, are Ministers aware that there is an audience other than his divided party which has views on flexibility? Does he consider that a company such as Toyota will be prepared to invest £700 million in Britain to create 2, 500 jobs, or a further £200 million to create 1, 000 jobs, when we have a government that do not know whether they are in or out?

Lord Inglewood

My Lords, the Government are most grateful for what the Toyota company has done in bringing prosperity and jobs to this country.

Lord Dixon-Smith

My Lords, does my noble friend agree that some flexibility of view between individual colleagues is to be preferred to a situation in which only one view is allowed to prevail?

Lord Inglewood

My Lords, the Government have a policy for which all the members are responsible collectively. At the same time, within that umbrella, there is room for disagreement on points of emphasis.

Lord Kennet

My Lords, are the Government grateful to Toyota for the advice which it gave them yesterday; namely, that it would do better and invest more in this country if we went into the EMU?

Lord Inglewood

My Lords, businessmen have expressed a wide range of opinions about the merits and demerits of joining the EMU. That is why the Government's policy of "wait and see" is so wise.