Sitting of 8 October 1986

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR On the Woolsack.
Prayers—Read by the Lord Bishop of Leicester.

Rented Housing: Building Society Investment
Lord Campbell of Croy: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they intend to encourage housing associations and building societies to co-operate in providing more accommodation for renting.
Baroness Hooper: Yes, my Lords. We have always maintained close contact with the building societies, and we have been in discussion with them for some time about the prospects for increased investment on their part in rented housing. The new Building Societies Act will allow societies to play a more direct role in the provision of housing for rent. We have also been working with the Housing Corporation to develop housing association rented housing schemes funded through a combination of private finance and housing association grant. We are confident that some schemes of this kind will start in the next financial year.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for her very agreeable reply. Is she aware that the new powers available to building societies can make such co-operation more fruitful, and that the country's economy would benefit from the greater mobility which will be made possible for people whose jobs require them to move from time to time? The right to rent would be assisted, in addition to the right to buy.
Baroness Hooper: Yes, my Lords. The Building Societies Act will allow building societies to provide rented housing directly or through subsidiaries. Societies are now considering what new powers they will use, and already societies are using existing powers to make index-linked loans to housing associations for rented housing let under the assured tenancy scheme. An example of that is the project under way at Milton Keynes. Certainly the Government are well aware of the advantages in terms of job mobility that those new provisions will allow.
Lord Mellish: My Lords, while the information about building societies is good news, will the Minister say a little more about the housing associations? They exist only because of money they receive from the Housing Corporation, over which the Government have complete control. The key is how much money the Government will allow the Housing Corporation to allocate to the housing associations, bearing in mind that the corporation has already allocated for the whole of the coming year, up to March 1987, and it is
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impossible now for housing associations to ask for increased funds. I therefore plead with the Minister, if she means what she says about providing more rented accommodation, to do it through the Housing Corporation and give it more cash to lend.
Baroness Hooper: My Lords, I feel sure that my right honourable friend the Secretary of State will note what the noble Lord has said. In fact, it is very early days, because the powers under both the Building Societies Act and the Housing and Planning Bill, which we hope will shortly become an Act, will not be coming into effect until early next year. Assuming that it is possible to begin some pilot schemes next year, it is likely that the Housing Corporation will select a relatively small number of associations likely to be involved.
If the use of private finance becomes more widely adopted I am sure it will be for associations to bid for resources for their schemes in the same way as they do under the current funding arrangements. Clearly the basic underlying funding is very much subject to review in the light of the new activities that are contemplated.
Lord Mackie of Benshie: My Lords, if the Government are as keen as they say they are on houses to rent, will the Minister say why they are forcing the Scottish housing associations, against their will, to sell their houses?
Baroness Hooper: Not without notice, my Lords. I think that is slightly outside the scope of my original reply. I shall nevertheless make inquiries and let the noble Lord know as soon as possible.
Lord Harmar-Nicholls: My Lords, does my noble friend think that, so long as there are more tenants with a vote than there are landlords with a vote, we shall ever allow the private owner to invest in a private enterprise building scheme for renting on the scale that we need?
Baroness Hooper: My Lords, as I said, it is still very early days. The powers that are to come will be in effect early next year. The Government are confident that those powers will enable a substantial increase in the availability of rented accommodation. I note carefully the importance of the votes of tenants versus those of landlords, to which my noble friend referred.
Lord Dean of Beswick: My Lords, is the Minister aware that anybody should welcome an increase in the number of properties to be let in the rented sector, provided they are let at rents that people can afford? The Minister will also be aware of a statement that was made by Mr. John Patten at the party conference yesterday about a policy regarding this matter. He indicated that forthcoming legislation would, however, carry a degree of protection for the potential tenants who will occupy those houses. Can the Minister give an undertaking that any such future measures as are introduced will give an absolute guarantee and undertaking to protect the existing tenants in the private sector and will not reintroduce exploitation?
Baroness Hooper: My Lords, I think there is little difficulty in saying that the Government will certainly bear in mind the rights of existing tenants in the private sector. The Government are also confident that their provisions will protect the traditional role of building societies and housing associations.
Lord Moyne: My Lords, echoing the question of the noble Lord, Lord Mellish, would not housing association activities be greatly speeded up if more funds were made available to the Housing Corporation so that more schemes could be got into the pipeline for site acquisition and planning permission? In answer to a supplementary question of mine earlier, I was told the hold-up is site acquisition and planning permission. Is it not a chicken and egg situation? Could there not be more food for the chicken?
Baroness Hooper: My Lords, I appreciate that the schemes which mix housing association grants and private finance are taking some time to develop. As I have said more than once already, this is a new scheme and we are in its very early days, but these schemes have exciting possibilities. The situation is not as straightforward as it may appear. There is a delicate balance of interests among the participants involved, the housing associations, the funding body and the Government. Associations and institutions have to understand that the use of private finance is of no advantage if, in effect, the public sector carries the risk.
Lord Wallace of Coslany: My Lords, is the noble Baroness aware that it is stated that local authorities have large sums of money accumulated through the sale of council houses and that they are restricted in the building of further houses to rent? Would it not be better to let them get on with that?
Baroness Hooper: My Lords, I think that there is nothing in the government proposals which will prevent that.

Highway Construction: Waste Materials Usage
2.44 p.m.
Lord Graham of Edmonton: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are now ready to publish the report of the interdepartmental committee which has considered the effectiveness of existing procedures for increasing -the use of waste materials, including minestone, in highway construction.
Viscount Davidson: My Lords, the report of the interdepartmental committee was published on 3rd June. A copy has been placed in the Library.
Lord Graham of Edmonton: My Lords, will the Minister accept that what I was seeking to obtain was the Government's response to the report? I understand
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that, after consultations, the report is now available and that the Government have accepted all its recommendations. Will the Minister bear in mind that there are 3,000 million tonnes of colliery spoil stockpiled throughout Great Britain? If the main recommendation of the report, as I understand it, is to abandon the system of dual tendering, can he assure the House and the country that the Government have plans to urge contractors to make better use of the spoil in the making of roads?
Viscount Davidson: My Lords, I am pleased to confirm to the noble Lord that, on the principle that the minestone that is rolling can gather no moss, acceptance of the recommendations was announced on 1st October. The procedure of dual tendering was found to be ineffective and very costly. In future greater reliance will be placed upon marketing and competitive pricing by waste producers. Information will be given to tenderers to ensure that they do not overlook likely waste sources.
Lord Ezra: My Lords, as the person who was responsible for setting up the Minestone Executive of the National Coal Board, the purpose of which was to make the best use of waste material associated with mining coal, may I ask the noble Viscount whether he is aware of the great efforts made by that executive to segregate and grade minestone to make it suitable for road building? In the light of the Government's decision to give up dual tendering, nevertheless will great efforts be made to use this material wherever possible?
Viscount Davidson: My Lords, I can certainly confirm that. If I may just summarise the report, the Government feel that road construction can make a useful contribution to waste disposal and we want to encourage its use wherever and whenever that is economically viable.
Lord Underhill: My Lords, I welcome the decision announced by the noble Viscount. I note that the Department of Transport's press notice of 1st October referred to the consultations and stated that some organisations which responded were heartily in favour but others were critical. Is it proposed to issue a report of the consultations or to place a copy in the Library?
Viscount Davidson: My Lords, I have a summary of the comments received on the report, but as it is rather lengthy and detailed, perhaps the noble Lord will be satisfied if I send him a copy. I shall also consider placing a copy in the Library.
Lord Graham of Edmonton: My Lords, as I know that this is a Minister who leaves no stone unturned, may I ask him to accept that I am not at all certain that under the previous system of dual tendering Ministries were as enthusiastic as I believe they ought to have been to see that the scheme worked? Although I acknowledge the response given to my noble friend Lord Underhill, can the Minister tell us what was the response of the National Coal Board—that is to say, the Minestone Executive—to the recommendations in the report?
Viscount Davidson: My Lords, I am afraid that I do not have that in front of me but it will be contained in the document that I place in the Library.

Diplomatic Missions: Unpaid Parking Fines
2.48 p.m.
Lord Brougham and Vaux: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether there has been any decrease in the number of unpaid parking fines incurred by members of diplomatic missions over the past 12 months.
The Minister of State, Foreign and Commonwealth Office (Baroness Young): My Lords, diplomatic missions incurred 33,904 unpaid parking fines in the 12 months up to 30th June 1986. This represents a decrease of over 63 per cent. over the total of 92,285 for the previous 12-month period. We welcome the co-operation of diplomatic missions with the stricter policy introduced in May 1985 and are looking for a further reduction.
Lord Brougham and Vaux: My Lords, I thank my noble friend for that welcome news. Can she tell the House whether, in the light of those welcome trends, there has been any mission which has gone against this significantly?
Baroness Young: My Lords, none significantly. Nearly all missions have reduced their fines since 1984, some more dramatically than others. We are intensifying our efforts to persuade those which have not yet fallen into line to do so.
Lord Cledwyn of Penrhos: My Lords, we welcome the decrease announced by the noble Baroness. Can she say how much money has been lost as a result of these claims for immunity, and whether there have been any automatic expulsions as a result of the tightened procedures?
Baroness Young: My Lords, on the question of the money, not without notice! But on the question of the second part of the noble Lord's supplementary question, I can tell him that 14 diplomats were sent home in 1982, 17 in 1983, 13 in 1984, 25 in 1985 and that 13, so far, in 1986, because of serious parking offences, have been removed from the United Kingdom at our request or on the initiative of their own government.
Lord Nugent of Guildford: My Lords, while welcoming what my noble friend has said about the reduction, may I ask whether wheel clamping can be appropriately applied to these particular offenders?
Baroness Young: My Lords, on that particular point, because diplomats have immunity from criminal jurisdiction and clamping is a penal measure both in intent and in effect, it in fact contravenes the
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Vienna Convention. If my noble friend would like to refresh his memory, this point was fully set out in Cmnd. 9497 of April 1985 on Diplomatic Immunities and Privileges.
Lord Underhill: My Lords, when this matter was raised on a previous occasion the House was assured by the Minister that vehicles of diplomatic missions which were in dangerous positions could be towed away; and figures were given. Could the noble Baroness assure us that that is still the position? Further, has she any figures available of the numbers towed away in the last 12 months?
Baroness Young: My Lords, I cannot, without notice, give a figure for vehicles towed away, but that of course is allowable and many cars have been towed away.
Lord Orr-Ewing: My Lords, would my noble friend consider publishing a list which shows those diplomatic missions who have made a marked improvement, and equally those diplomatic missions who are still recalcitrant in this manner and seem to take no account of the inconveniences and law-breaking caused by their diplomats? Would not a list of this sort be quite salutary and probably be of greater effect than any Answers given in this House?
Baroness Young: My Lords, I can give my noble friend some further information. The ten nations with the highest totals of unpaid parking fines incurred in the June quarter were, in order: Saudi Arabia, France, China, Nigeria, Sudan, Ghana, Turkey, Egypt, Iraq and Malaysia. Preliminary statistics for the September quarter indicate that of these missions Nigeria has achieved a significant decrease in parking fines.
May I take the opportunity to correct something which I said in reply to the noble Lord, Lord Cledwyn, when I gave him the figures of those diplomats who have been sent home? It was those accused of serious offences, which is not quite the same as the question he asked.
Lord Mishcon: My Lords, would the noble Baroness the Minister enlighten the House as to the procedure adopted with the various embassies when there is a question of an unpaid parking fine? Is the Foreign Office involved in a protest to the ambassador? Is the Department of Transport involved in some protest? What procedure is adopted in order that the embassies know at a proper level how much we dislike this sort of happening?
Baroness Young: My Lords, the new policy was introduced in April 1985 and we determined that we would keep detailed records of unpaid parking fines incurred by all diplomatic cars with diplomatic registration plates, both official and private, from the 1st May. We (that is, in this case the Foreign and Commonwealth Office) notified them at the same time that persistent and deliberate failure to pay parking fines would call into question their acceptability as members of diplomatic missions in London. We have since followed that policy.

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So far we have issued 57 letters requesting the withdrawal of offenders unless satisfactory arrangements for payment of fines were made, and where there is clear evidence of the abuse of parking regulations we do at that point issue a warning. We would ask for the withdrawal of an individual when it became clear that our warnings were not having any effect. However, I hope the noble Lord will agree that the figures I have given show a steady downward trend and we hope very much that, as certain missions have brought about spectacular reductions in fines, we shall continue to see a steady downward trend in this matter.
Lord Cledwyn of Penrhos: My Lords, would the noble Baroness not agree that it is a matter for comment that France should be so very high on the list? Would she express the hope that these things will be improved when the Channel Tunnel has been completed?
Baroness Young: Yes, my Lords.
Lord Renton: My Lords, can my noble friend say whether it is an offence for a person who is not a duly accredited diplomat to put CD plates on his or her car? If so, has my noble friend any idea of the number of prosecutions which take place for such an offence?
Baroness Young: My Lords, I do not have the specific information my noble friend asks for, not without notice.
Lord Strabolgi: My Lords, arising out of that question, can the noble Baroness say to whom diplomatic immunity applies in the individual missions? Is it just the ambassador and the senior staff or does it extend right down to junior clerical and ancillary staff?
Baroness Young: My Lords, diplomatic immunity would apply to certain named people in the embassy. I think one has to remember what its purpose is. It is not to benefit the individuals but to ensure their efficient performance of functions in diplomatic missions as representing individual states. The Vienna Convention on diplomatic relations codifies this longstanding international practice.
Lord Kennet: My Lords, can the noble Baroness tell the House what instructions are in force to British diplomats about paying parking fines in for instance, Paris?
Baroness Young: My Lords, we would expect all British diplomats to obey the laws of the countries to which they are accredited.

Gibraltar/Spain: Frontier Guards
2.56 p.m.
Lord Boyd-Carpenter: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
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The Question was as follows:
To ask Her Majesty's Government on what date and for what reasons the military guard at the frontier between Gibraltar and Spain was withdrawn; and whether the Spanish military guard has now been withdrawn.
Baroness Young: My Lords, the guard was withdrawn on the 31st July. It no longer seems appropriate to have a guard of this nature at a frontier between two countries who are European Community partners and North Atlantic Treaty Organisation allies. The Spanish Government have not yet withdrawn their guard. We will continue to press them to do so.
Lord Boyd-Carpenter: My Lords, does my noble friend think that the considerations which she has adduced for the withdrawal of a guard which has been there for 250 years apply with absolute equality to the Spanish guard? Would it not have been more sensible to have made sure that if these guards were to be withdrawn they should be withdrawn simultaneously?
Baroness Young: My Lords, we informed the Spanish Government in advance of our intention to withdraw the guard and we urged them to make a reciprocal gesture. We shall continue to press them to do so. But can I say to my noble friend that the Gibraltar Government have expressed satisfaction at the terms of the response of my right honourable and learned friend the Foreign Secretary on 19th September to the memorandum which was signed by leaders of all Gibraltar's political parties on this matter.
Lord Morris: My Lords, is this not a superb example of the uselessness of unilateral disarmament?
Baroness Young: My Lords, I can quite see that my noble friend is making a very clever debating point, but I think we ought to realise that in this matter we are, after all, talking about a country which is our partner in the European Community, our ally in NATO and one with whom we have good diplomatic relations.
Lord Cledwyn of Penrhos: My Lords, while we understand the reaction to some extent, would the noble Baroness confirm that this is in no way a derogation of sovereignty? Would she go a step further and say what progress is being made in an easement of the regulations with regard to aircraft flying into Gibraltar airport? Has there been any progress along those lines which, if there is an easement, could bring enormous benefit by way of tourism to Gibraltar?
Baroness Young: My Lords, I am very glad to give an assurance to the noble Lord, Lord Cledwyn, and indeed to the whole House, that the British Government stands by the Preamble to the 1969 Constitution. This assurance has been given many times in your Lordships' House, in another place and of course in Gibraltar itself.
On the question of air space, the Spanish authorities lifted the prohibition over Spanish air space on civilian

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aircraft using Royal Air Force Gibraltar following the implementation of the Brussels Agreement in February 1985. We continue to look for ways in which we can persuade the Spanish authorities to make changes to prohibited air space for military aircraft.
Lord Boyd-Carpenter: My Lords, would my noble friend, if the Spanish Government persist in maintaining the guard, indicate to them that if they do not accept the considerations of European unity which were referred to so eloquently, we shall find it necessary to restore our own?
Baroness Young: My Lords, in the course of our discussions with the Spanish, which take place at official level and of course will again take place at ministerial level, we have made our position on this matter absolutely clear. We hope very much that the Spanish will consider withdrawing their ceremonial guard as well.

Business
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Committee stage of the European Communities (Amendment) Bill will be adjourned at approximately 7 p.m. for approximately one hour and that during this adjournment the Local Authorities Cemeteries (Amendment) Order 1986 will be taken.

Urban Development Corporations
3.1 p.m.
Viscount Davidson: With permission, my Lords, I should like to make a Statement about urban development corporations.
My right honourable friend the Secretary of State for the Environment is today announcing the Government's intention to set up further urban development corporations. Subject to the approval by both Houses of Parliament of the necessary designation orders, four will be set up during the next two years in Trafford Park in Greater Manchester; on Teesside; in the Black Country; and in Tyne and Wear. These are all places with major concentrations of derelict or disused former industrial land and serious problems in creating employment and attracting new investment.
Under the Local Government Planning and Land Act 1980, the area of an urban development corporation in England must fall within a metropolitan county or inner London. Three of the urban development corporations now proposed would lie within metropolitan counties. Teesside, however, lies within the county of Cleveland, which is not a metropolitan county. Thus an urban development corporation cannot be set up on Teesside under the legislation as it now stands. But the problems of unemployment and industrial dereliction on Teesside are at least as severe as those in any other area in the country.
My noble friend Lord Skelmersdale has therefore tabled an amendment to the Housing and Planning
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Bill to remove the present restriction on the designation of urban development corporation areas in England.
My Lords, that concludes the Statement.
Baroness David: My Lords, I should like to thank the Minister for making the Statement about the new urban development corporations, which I understand are being announced today by the Secretary of State. Of course, we on this side welcome anything that will help the gross problems of unemployment and dereliction that exist in the areas mentioned. We also welcome anything that will help unemployment
Perhaps I may ask the Minister how many jobs will be created as a result of these UDCs, and, very importantly, what resources are to be put into them. This matters greatly, and we must remember, in thinking of it, that these areas have been deprived of vast sums in rate support grant in the past five years. Trafford-Salford alone lost £270 million in real terms since 1981 and other areas have also lost equally large sums. At present, public expenditure on the two existing urban development corporations is £93 million for 1986–87, according to the Public Expenditure Survey (Cmnd. 9702); and in order to make up the difference between that and what has been lost on rate support grant, a great deal of money must be put in. May I therefore ask what kind of sums are envisaged?
We have to remember as well that vast sums will be needed for infrastructure that has been allowed to decay, and also for transport facilities. Where will that money come from? Will it be taken from the present UDC allocations or will be entirely new money?
It is also very important to know what local authority and community involvement there will be. Will there be involvement by local businesses, and tenants' organisations and so on, as well as by local authorities? I understand that in Cleveland, for instance, something called the Cleveland Initiative is very interested in doing something in this area. It is, I am quite sure, very important that the UDCs should work with and not against the local authorities in the area. That has been one of the problems, I believe, in London docklands, and I hope that the Government, with that in mind, will have many consultations with the local authorities involved before these boundaries are decided and the actual corporations are set up.
Will the Government also ensure that the structure of the boards that run the UDCs will reflect the need to involve local interests? It is very important that people from the local councils should have a right to be on the boards. Certainly, when I was a member of Peterborough Development Corporation, it helped greatly if people were appointed in their own right as councillors and could be there to put the point of view of the local authority. That perhaps has been one of the reasons that London docklands has had its problems.
With those questions, we give our welcome to the announcement—so long as the answers are satisfactory!
Baroness Stedman: My Lords, I first thank the Leader of the House for responding so positively to my PNQ this morning and the noble Viscount, Lord Davidson, for making the Statement. Last evening I received a letter from the right honourable gentleman the Secretary of State telling me of the announcement on the lines of the Statement today. I congratulate the Leader of the House on ensuring that the Statement was made to this House in Parliament and not from the conference platform in Bournemouth. Will he ensure that other statements from Bournemouth are also made to this House first, either by the appropriate Minister or by his junior Minister in this House?
Concerning the Statement itself, I can understand the need for the proposed amendments to the Housing and Planning Bill to extend government powers to non-metropolitan areas. As well as considering UDCs, have the Government considered a general review of the system of payment of grants in order to concentrate money on inner-city needs? Has the time not come for a new framework for policies enabling action by both central and local government agencies and voluntary organisations to integrate their programmes? Does the Minister agree that, with the formation of the urban development corporations, the local authorities are bypassed altogether through the creation of more of these corporations, however good a job they may be doing?
I can see the Government's problem in trying to make clear that inner cities are still one of their national priorities, when they have cut back urban renewal funds by 10 per cent. in real terms in this financial year. However, like the noble Baroness, Lady David, I must ask where the money will come from for the new urban development corporations. Is this new money or extra money? From which pocket will it come and who or what will be the loser? We have seen many initiatives launched in a blaze of publicity—such things as the city action teams and the task forces—but we have seen no extra cash and ultimately, therefore, no long-term useful effects.
Viscount Davidson: My Lords, I am most grateful to the noble Baroness, Lady David, and the noble Baroness, Lady Stedman, for their welcoming reception of the Statement. I am not sure that I am capable of answering all the questions they have asked, since my briefing was necessarily short. However, I shall do my best.
So far as jobs are concerned, a detailed consultant's study of Trafford Park shows the potential to create some 16,000 new jobs. We do not as yet have corresponding figures for the other areas. So far as resources are concerned, each of the new UDCs could spend between £100 million and £160 million over six or seven years. I cannot tell your Lordships exactly how the money will be found at this stage but some of the expenditure which the UDCs incur will represent work that would otherwise have eventually been undertaken under existing programmes. Overall, the announcement represents a substantial increase in the resources devoted to urban regeneration.
So far as discussions with the local authorities are concerned, before the areas are designated we certainly intend to have discussions with all the local authorities
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involved. Without appearing to be "chicken", as they say, in view of the fact that the amendments will be coming up for discussion when we reach Part VI of the Bill next Monday and when the Minister will be here, I suggest that we leave the substantive discussion on these matters until then.
Lord Gisborough: My Lords, I am delighted to hear that Cleveland has been included for an urban development corporation, because we have no less than 23 per cent. unemployment throughout the county and up to 90 per cent. unemployment in some quite sizeable areas, so we really need help. Can my noble friend say whether this is for Middlesbrough or for Hartlepool? They are two different factors and I believe that Hartlepool is probably the place where it needs to be. Secondly, I should like to support what the noble Baroness opposite said. Surely the Minister will take into account the contribution of the local authority and their involvement. Having said that, I am sure that the lesson has been learned with the London scheme. The commercial interest must be in charge and, unfortunately, must have predominance over the elected council.
Viscount Davidson: My Lords, I am grateful to my noble friend Lord Gisborough. I can say that so far as Teesside is concerned the closure of chemical, steel and shipbuilding works has left the largest continuous area of de-industrialised land in Europe, along the banks of the Tees stretching from Langbaurgh through Middlesbrough to Stockton, and some 3,500 acres of derelict land are involved in that area.
Lord Tordoff: My Lords, I wonder whether I may underline what my noble friend Lady Stedman said. I hope that the Leader of the House will take on board her words, particularly in relation to an anticipated Statement by a Member of your Lordships' House in the shape of the noble Lord, Lord Young of Graffham. It would be looked upon with some disfavour by your Lordships if Statements by him, in particular, were made at Bournemouth and not to your Lordships' House while Parliament is sitting; and while this House is in session Parliament is, of course, sitting.
May I direct my few remarks specifically to Trafford Park in Manchester? May I ask the noble Viscount whether he will comment on the impact of this new scheme on the Phoenix initiative, which received a very considerable amount of support from Sir George Young, Mr. Nicholas Ridley, Mr. John Patten, Mrs. Angela Rumbold and other members of Government when this initiative was put together? This was a co-operative venture between private capital, the local authority, the Department of Trade and Industry and the Department of the Environment. I hope that the imposition of this new corporation will not destroy that interesting initiative which could be an example to many other parts of the country.
Viscount Davidson: My Lords, so far as the first part of the noble Lord's remarks are concerned, if there is a need for a Statement to be made in this House when my noble friend is making a statement at Bournemouth, I assure the noble Lord that I shall make it—
The Lord President of the Council (Viscount Whitelaw): My Lords, I shall make it.
Viscount Davidson: Thank Goodness, my Lords! My noble friend the Leader of the House will make it. So far as Trafford Park is concerned, the Government will also be considering the inclusion of other land within the overall urban development area.
Baroness Fisher of Rednal: My Lords, can the noble Viscount describe the areas which will cover the Black Country? Are these the local authorities that used to comprise the West Midlands county?
Viscount Davidson: My Lords, I am afraid that the only note I have on the Black Country is that these are vast areas of derelict and disused land, as metal bashing industries have declined, and the area clearly needs a new image building on entrepreneurial spirit. I am afraid that I have no details of the geographical location.
3.15 p.m.
Lord Diamond: My Lords, is the noble Viscount the Minister aware that we on this side—I am sure in common with all the Members of your Lordships' House—are very grateful indeed for what has just been said about the precedent which the Leader of the House is going to adopt in these unusual circumstances, where there is a party conference going on at the same time as your Lordships' House, this workhouse, is uniquely engaged? May I also ask the Minister, in view of the fact that the resources available are one of the essential ingredients of the whole of his announcement, and also in view of the fact that what he has so far indicated is that there will be a pure transfer and no new resources allocated for the purpose, whether when we reach the relevant amendment, to which he has referred, the noble Viscount will have instructed himself completely so as to be able to tell the House exactly whether there are new resources and where they are coming from?
Viscount Davidson: My Lords, I shall certainly convey the noble Lord's remarks to my noble friend Lord Skelmersdale who will be dealing with the matter next Monday.
Viscount Whitelaw: My Lords, I think I ought to reply to something which the noble Lord, Lord Diamond, said, because there was perhaps some misunderstanding earlier when I mentioned the point to my noble friend. I must make it perfectly clear that I have not yet created a precedent, but I think it will only be to the acceptance of the House, if my noble friend Lord Young were to say something tomorrow which was felt to be worthy of a Statement to this House, and if a Statement to this House were wanted, that it would obviously be proper for me, as the only Cabinet Minister available to do it, other than the Lord Chancellor, to make that Statement myself, and that I will do.
Lord Cledwyn of Penrhos: My Lords, I am very much obliged to the Leader of the House for what he has said. I wonder whether he would go a step further
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and say that if major Government statements are made in Bournemouth then, as a matter of course, they should be repeated in this House because Parliament is sitting at this time.
Viscount Whitelaw: My Lords, I shall certainly consider what the noble Lord has said in all the circumstances that might come forward. Where another Minister in that department was available, I was not myself considering it right to do it. It is simply the point that, my noble friend Lord Young being in this House, it seemed that I should certainly do it in his position.
Lord Cledwyn of Penrhos: My Lords, with great respect it is not only the Statement of the noble Lord, Lord Young, which would be important. If any Cabinet Minister made a statement of importance in relation to the Government and the nation then, as a matter of course, that statement should be made by the responsible Minister in this House, because while this House is sitting Parliament is sitting.
Viscount Whitelaw: My Lords, that is a matter for consideration and we shall see what comes up tomorrow or what might happen. I shall certainly take account of what the noble Lord said. I could not commit myself to every possible statement; that would go too far.
Lord Dean of Beswick: My Lords, is the Minister aware that I fully concur with what my noble friend on the Front Bench said regarding the withdrawal since 1979 of financial resources from the Trafford area? Having worked in Trafford Park till becoming a Member of another place, I have to say that any new input of finance in order to re-invigorate the industrial activity there must be welcome. But may I also urge the Minister, as other noble Lords have done, not on this occasion to bypass the local authority, as to do so may well set up an obstruction which would be counter-productive to anybody? May I urge him to involve them as much as he can in all the proceedings?
Viscount Davidson: My Lords, I can assure the noble Lord, Lord Dean, as I said earlier, that we shall be discussing with local authorities all the matters involved.
Lord Nugent of Guildford: My Lords, is my noble friend aware that in this context the outstanding success of the Docklands Corporation should be borne in mind, because that structure has been outstandingly successful in attracting private capital for this spectacular development in the derelict docklands? Unless the structure of the urban development corporations is set up in a way which will be attractive to private capital—which will not always occur if it is simply a local authority matter—we may very well not get the input of private capital which we so very much need. Will he bear that in mind?
Viscount Davidson: My Lords, I am most grateful to my noble friend Lord Nugent. I shall not only bear in mind what he has said but will see that it is conveyed to my noble friend.
Lord Taylor of Blackburn: My Lords, may I ask the noble Viscount whether when the amendment is tabled it will concern only Cleveland, or will it at some future date enable the Government to extend this to other shire counties?
Viscount Davidson: My Lords, I am unable to reply to that question, but I shall make sure that a reply is sent to the noble Lord.
Lord Tordoff: My Lords, if it is of assistance to the House, the amendment is in the Printed Paper Office. The purpose of the amendment is to extend the power of an earlier Act outside metropolitan areas. Therefore I think the answer to the noble Lord's question is, yes.
Viscount Davidson: My Lords, I am most grateful to the noble Lord for answering the question.
Lord Underhill: My Lords, may I be permitted a third intervention from the Front Bench? I intervene not as a Member of the Front Bench but as one of the five Members of your Lordships' House who were members of the Select Committee which recommended the formation of the London Docklands Corporation. I hope that before this amendment is placed before your Lordships the Minister will read very carefully, as I am sure he will, the report of the Select Committee on the London Docklands Corporation. There were special circumstances in London, and the Committee expressed the view that it would not lightly recommend a transfer of planning powers for a wide area to the Secretary of State from democratically elected councils. There were special circumstances in London which I hope will be taken into consideration, along with the report of the debate in your Lordships' House when we discussed the Select Committee report.
Viscount Davidson: My Lords, I can only say that I shall make sure that my noble friend reads Hansard.
Lord Sefton of Garston: My Lords, in taking their decision am I right in assuming that the Government bore in mind the success or otherwise of the two development corporations—Merseyside and London Docklands? Am I also right in assuming that in taking that decision they had the full facts in front of them, which I imagine the Minister replying will also have in front of him? Can he tell the House how many jobs have been created on Merseyside during the life of the development corporation; how many full-time and permanent jobs have been created and what was the cost per job?
Viscount Davidson: My Lords, I am afraid that I cannot tell the House that.
Lord Sefton of Garston: My Lords, can the Minister make sure that before any necessary amendment is moved the House is informed of that?
Viscount Davidson; My Lords, I have already suggested that as this will all be discussed in the debate on the amendment on Monday these more substantive matters should be left until then.

British Railways (No. 2) Bill
3.24 p.m.
Read a second time, and committed to a Select Committee.

European Communities (Amendment) Bill
3.25 p.m.
Baroness Young: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do not resolve itself into Committee.—(Baroness Young.)
Lord Bruce of Donington: My Lords, before the House goes into Committee, I should like on behalf of many of your Lordships to express my protest at the way in which this important Bill has so far been introduced and passed through some of its stages in Parliament. This is a very small Bill indeed but it has enormous national implications. It has considerable constitutional implications, yet it has been treated, or was initially treated in another place, as a Bill of small consequence. Indeed in this House it was given its Second Reading on the last day before the Recess.
The problem in part arises from the structure of the Bill itself. I have to complain that with a Bill of this kind, referring to many other documents, far greater explanation ought to have been given of its full implications. The Bill refers to the Single European Act, which in turn refers to the Treaty of Rome. It refers to a number of declarations, some of which have not been published at all but merely left in the Library of the House. To find out the true extent of this Bill, its true implications for the country and its importance has been very long and tortuous task indeed.
Having said that, I should like to say this. Out of the 55 amendments that were submitted in another place, no fewer than 30 fell under the guillotine and the Bill was given some 20½ hours in Committee. As I understand it, the intention in regard to the Bill in this House is that it should be given a comparatively restricted amount of time within which your Lordships will be afforded the opportunity of discussing it. I therefore have to say (and I say it not only on my own behalf but on behalf of other noble Lords in different parts of the House) that this Bill will be contested. We ask the Leader of the House to afford sufficient time to go into the great detail that it is necessary to go into in order that the full implications are understood not only in this House but in the country.
Twenty-four and a half hours were spent by your Lordships in this House discussing the Salmon Bill. I am not suggesting that salmon is not important to the incomes and palates of perhaps a fairly limited section of the population. I suggest to the Leader of the House and to your Lordships that it would look very odd if a Bill of this constitutional importance were not granted equivalent facilities.
Baroness Young: My Lords, this Bill has already been the subject of extensive debate in another place

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for more than five days, three of which were in Committee. Your Lordships' House debated the general principles of the Bill on 31st July on Second Reading. It was my view that in this House, although a large number of amendments have been tabled for the Committee stage, they could be grouped so as to form six major debates. It is therefore not unreasonable to expect the Committee to cover this ground in the course of today. The House will be returning to the Bill in due course at Report stage and at Third Reading.
I regret that the noble Lord, Lord Bruce of Donington, should feel that he did not have all the papers available. My understanding is that the European section of the Printed Paper Office has been in the process of reorganisation during the recess. But had the noble Lord sought the assistance of my office, or indeed I am sure of the House authorities, we should have done our best to help him.
May I suggest that, rather taking up more time debating this Motion, the House do now resolve itself into Committee? Otherwise we shall have even less time for the consideration of this important Bill.
Lord Broxbourne: My Lords, although in no way associating myself with the strictures expressed with characteristic verve and vigour by the noble Lord, Lord Bruce of Donington, perhaps I may express the hope that my noble friend has not said her last word on the matter. I see that the Leader of the House is here and indeed the Chief Whip, though seated in an unaccustomed place, presumably only temporarily. I hope that consideration can be given, if necessary, to allowing further time for this Bill, having regard to its great constitutional importance.
My noble friend the Minister will see, if she glances to her right, an assemblage of noble and learned Lords on the Cross-Benches who have expressed interest in this matter and whose views are eagerly awaited on these important constitutional issues. May we therefore take it that these matters will not have to be debated in the small hours of the morning—not a time for getting maximum cerebral attention to these esoteric matters—but that, if necessary, further time can be afforded?
Lord Denning: My Lords, may I add a few words? I have in my hand documents which are essential reading for anyone who is to take a constructive part in this discussion. The first is the Bill—a little Bill of two or three pages. Next to it, in a way, are the amendments. If noble Lords came into this House in the ordinary way and had a Bill, with amendments, in front of them they could, on reading them, be able to understand and take a constructive part in the proceedings.
In this case I refer to the Bill itself. It tells us nothing whatever of any importance. When one reads the Explanatory Memorandum one does not realise in the least that it involves important constitutional issues for this country, for this Parliament, and for Her Majesty the Queen herself.
Arising from that, and before I turn to any further matters, the really important part of this Bill is that
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which states we are to have one more treaty added. We are to have a treaty called the Single European Act, which is to be added to the European treaties. Noble Lords may not regard that as a very serious matter, because it is not mentioned at all. However, I am sure the Government will realise that the treaty by itself is no part of the law of England. It is an Act of the executive and has no impact here at all unless both Houses of Parliament affirm it and make it part of our law.
The Bill is an amendment to the European Communities Act 1972, but it misses out the most important part. Section 2(1) of the 1972 Act makes every word of this treaty part of the law of England, to be available and enforced in the law. Every word of this treaty, this Single European Act, is to be made part of the law of England. That is what we are doing. So let us turn to the Single European Act. The preamble is comprehensive enough. Its intention is to transform the state as a whole into the European Union. Is not that a political matter of the first importance?
However, when one reads beyond the preamble one becomes completely lost. One cannot understand one word of all these provisions, pages of them, because they refer back to the Treaty of Rome. Noble Lords would have some difficulty in finding that, but there it is. As the Bill is amending all those provisions, one must have the Treaty of Rome available. But one would have some difficulty in getting it. It is not on the statute book. Therefore, one must have available this Single European Act and the Treaty of Rome, and one must compare one clause with another—pages of them.
Noble Lords would not get very far in understanding until they eventually turned to reports by the Select Committee of this House. They are very good reading and have been well done by Members of this House. In those reports, one will see the important provisions. It is in the reports that one will see the constitutional point which ought to have been made clear at the beginning. The powers of the United Kingdom Parliament will be weakened by the Single European Act. The Select Committee draws the special attention of the House to this important fact.
The Government have not drawn attention to that. The Government have not mentioned one word of it all the way through. That is the important fact which is being brought before your Lordships for consideration. I am afraid it is very difficult to understand unless, as has been said, one reads that pile of documents. Therefore, I add my protest; but we must go ahead and do what we can.
Lord Edmund-Davies: My Lords, on 31st July this Bill was described by a noble Lord on the Government side as a quite modest Bill. Its modesty lies only in its physical size. It is full of the most widespread implications. It would be quite wrong and shameful if this Bill were considered now in an atmosphere of suppression—suppression by reason of time, not suppression intended by anybody.
It would be quite wrong to consider the Bill with one eye on the clock. It is a Bill on which even at this Committee stage—not the best stage to be considering

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a Bill—it would be wrong to have any feeling of pressure to cut short our observations. I hope the Bill will be approached in that way, giving it proper time. I hope that what I believe to be right will carry the day in this respect: that this Bill, which is of great constitutional importance, will be approached by everyone regardless of party affiliation. I approach the Bill in that way. I have no party affiliations. I should like to feel that all us can look at this matter in a liberal way and in a relaxed atmosphere.
On Question, Motion agreed to.
House in Committee accordingly.
(The LORD AMPTHILL in the Chair.]
Clause 1 [Extended meaning of "the Treaties" and "the Community Treaties"):
Lord Bruce of Doningtonmoved Amendment No. 1:
Page 3, line 13, after ("Communities) "), insert ("but not Article 4 of Chapter 1 thereof").
The noble Lord said: I have agreed, in the interests of expediting the Bill, to the grouping of Amendments Nos. 1, 6, 7, 25, 39, 40, 41 and 42, most of which, the Committee will readily apprehend, involve complicated legal questions. In view of that, I move the amendment formally in the hope that some observations might pass from the lips of the noble and learned Lord, Lord Denning, who is far more conversant with these legal matters than I am. I beg to move.
Lord Denning: I wish that I had put down my name to this amendment because it is important. As it is so impossible to understand what this is all about I must explain it.
The European Court has been overwhelmed with cases and cannot get through them. It is therefore seeking to make a number of lower courts—called attached courts—to deal with the gross overloading of work. That is the essential part of the article concerned, which in two or three places is a whole page long. The important point is that it is to set up a series of courts of first instance which would try cases on fact final, on law, and with appeal to the European Court.
I wish also to add a word about the European Court and its methods, which have been applied. They have been considered quite recently in the Court of Appeal in England. I am dealing with cases under those important articles 85 and 86 which deal with commercial matters of the first importance—abuse of a dominant position and unfair competition. Companies from the United Kingdom are closely involved in these matters. One case on those sections came, when I was sitting in the Court of Appeal, between an English Company, a garden cottage one, and a great English milk marketing board. The case I mentioned of 1985 was in the Court of Appeal between, again, two English companies, one from Belfast and the other from England. The case was all about repairing cameras, unfair competition and the like.
That last case went to the European Commission and thence to the European Court of Justice. I shall
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not go into the details of it, but the Master of the Rolls, Sir John Donaldson, said it was totally unlike anything in our judicial system, with both sides being heard and dealt with then. Instead, it went before the European Commission, who were themselves treated as the investigators, almost as the prosecutors, and who carried it through, as Sir John Donaldson said, quite dissimilarly from our own English procedure. Indeed, he said that it was to be regarded as administrative and not judicial at all. The Commission, were, if you please, acting, as I would think sometimes they do on the Continent, as an inquisitorial system, enforcing their own view, instead of as an adversarial system which the law of England has always maintained.
The question which I am seeking to raise before your Lordships this afternoon is: Are the subjects of Her Majesty to be compelled, for their rights and defences, to go over to Europe to courts manned by European judges with a procedure quite unknown to us, a procedure which our own courts have said is not judicial in the least but merely administrative? Are we to let British subjects go over in that way?
Now I come to the British Constitution. We have a basis which is quite unknown in Europe. Each one of us, and each judge (certainly each one here) has the oath of allegiance to the Queen and, corresponding to that in our constitution, is a duty on the Queen to protect us. By our constitution the Queen is the source and fountain of justice. It is at her behest that we have Royal Courts of Justice here; it is at her behest that our judges are Her Majesty's judges, and it is at her behest, for the protection of all of us in response to our allegiance to her, that she sets up the courts of justice to hear and decide our disputes.
I would like to emphasise that unknown in Europe is this constitutional principle of the allegiance of the British subject on the one hand, and, on the other, the duty of the Crown to protect the British subjects. Let me remind your Lordships of the oath of allegiance. It is constitutional, the oath which every Member of your Lordships' House takes, and it is from an Act going back 100 years or more:
"I do swear that I will be faithful and bear true allegiance to Her Majesty Queen Elizabeth the Second, her heirs and successors, according to law. So help me God."
Every one of your Lordships knows that oath of allegiance. It is part of our fundamental constitution. Let me remind you of our judges' oath as well:
"I do swear that I will well and truly serve our sovereign lady Queen Elizabeth the Second in the office of a justice of the High Court, and I will do right to all manner of people after the laws and usages of this realm without fear or favour, affection or ill-will."
There is our judicial system deriving from the Crown as the source and fountain of justice. No court can be set up in England, no court can exist in England, except by the authority of the Queen and Parliament. That has been so ever since the Bill of Rights.
This is also part of our Constitution: corresponding to that duty of each British subject to the Queen, the Queen herself is under corresponding duty to protect British subjects in our rights, which we have inherited all the way down the line. I remind you that the Roman Empire had the same duty. There is Paul and so on: "Can you do this to a Roman citizen?"—Civis Romanus sum. You all know that quotation. Did not Palmerston say in 1850, in his greatest speech:

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"As the Roman, in days of old, held himself free from indignity when he could say 'Civis Romanus sum, so also, a British subject, in whatever land he may be, shall feel confident that the watchful eye and the strong arm of England will protect him from injustice and wrong.".
That duty in England, the duty of protection of our citizens, the correlative of allegiance by the Queen, is done by provision of the police force to protect us, and by the courts of justice which she has established.
I need not go into all the cases. This principle can be found back in the time of Lord Coke, in Calvin's case, as between England and Scotland:
"Ligeance is the mutual bond and obligation between the King and his subjects, whereby subjects are called his liege subjects because they are bound to obey him; and he is called their liege Lord because he should maintain and defend them.".
The most recent illustration of it is the China Navigation case, reported in 1932 King's Bench. So the Queen is bound to protect us and to afford courts of justice on which we can rely and to which we can go.
In Europe that constitution is unknown. There is no one source or fountain of justice in Europe. Let me tell you the oath which, under this Treaty of Rome, each judge takes:
"I swear that I will perform my duties impartially and consistently, and preserve the secrecy and deliberations of the court".
I repeat:
"I will perform my duties".
What are those duties? Nowhere are they spelt out in the Court of Justice except in Article 162:
"The Court of Justice shall ensure that in the interpretation and application of the Treaty the law is observed".
The only duty of those Community judges is a duty to see that the law is observed; in other words, that Community law is observed, not the law of England. There is no duty to protect the British subject. Are we then today to say that British subjects are not to go to our courts in England or to Her Majesty's judges in order to secure justice; and that they are not to seek the protection of the law as we know it under the hearings and procedures which we have established over the centuries, but to go to an attached court, to the Court of Justice in Luxembourg?
According to this proposed article the attached court will operate according to the same modes of procedure as at the moment. It is a procedure and process which has already been condemned by the Court of Appeal in England as quite dissimilar from our English law and indeed merely administrative. Are British subjects to be compelled to go there?
That is my criticism of this article which is mentioned in two or three places in this part of the group that we are discussing now, as I tried to point out, because you cannot see it other than by reading through them. There it is in Amendment No. 42 on the Marshalled List:
"The provisions of Article 168A of the EEC Treaty"—
that is the article that we are now considering and it is the one which establishes these attached courts in Luxembourg—
"shall not be interpreted or applied so as to enable any such attached court to sit in the United Kingdom, or to exercise any jurisdiction over British subjects resident in the United Kingdom".
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That is subsection (1).
Subsection (2) states:
"In lieu of the jurisdiction of any such attached court, every British subject resident in the United Kingdom and owing allegiance to Her Majesty the Queen shall be entitled to the protection of Her Majesty, according to the law of England, administered by Her Majesty's Judges sitting in the Royal Courts of Justice under the Rules of the Supreme Court".
I am stressing the constitution there.
Then in subsection (3) there is a parallel jurisdiction where we do it ourselves:
"If and in so far as under Article 168A … any such attached court is given jurisdiction to decide disputes according to Community Law, a like jurisdiction shall be exercised by Her Majesty's Judges also to decide them according to Community Law (in so far as that is made part of the law of England …)".
So there it is. It is simple and intelligible, I hope. All it is saying is that we British subjects owe allegiance to the Queen and the Queen is under a duty to protect us. She has performed this duty by providing the Royal Courts of Justice to which we can take our disputes and have them decided by Her Majesty's judges. We should not be compelled to go over to a court in Europe manned by we know not whom or in what circumstances in order to go through a procedure and process that are altogether unknown to our law and which the Master of the Rolls has said are quite dissimilar to our own procedure and practice. Therefore I support Amendment No. 1.
Lord Gladwyn: My noble friend and colleague Lord Banks is in charge of this Bill so far as we are concerned and consequently he will deal with any individual amendments as and when they arise. However, in view of my 40-year association with what I might call the European idea, and indeed European institutions generally, it has been thought suitable by my colleagues for me to say now just a few words—only a few words—on the basic and fundamental decision which will confront the Committee when it votes this afternoon. Therefore I propose to intervene now in this debate once only and I shall not, except of course by my vote, contest any of the numerous individual amendments proposed by the noble Lord, Lord Bruce of Donington, along with those of the noble and learned Lord, Lord Denning, all of which, I regard as simple wrecking amendments, designed, as it were, to tear the guts out of the recently concluded Single European Act.
That is their intention. But if only one or two of the 53 or so amendments are accepted by the Committee, the danger is not averted. I would respectfully draw the attention of the Committee—and this is my main point—to the fact that the formal adoption of any single one of these amendments would mean that the whole treaty had in effect been repudiated by the British Parliament—repudiated, that is, in spite of the fact that it was believed by the Government to be in the interests of this country and that it has been accepted by all our Community partners. It has been accepted even by the Danes, who are perhaps more jealous of their "sovereignty" than any other nation in the world.
Since in practice it would be impossible to renegotiate this treaty in order to incorporate any of the Committee's amendments, obviously a very

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dangerous situation would arise which, unless somehow rectified by the other place—and it is not quite clear how it would be—could well mean that our partners in the Community would go ahead without us, thus I suppose eventually necessitating our withdrawal from the Community itself, which is something that I imagine many of the supporters of these amendments may well desire, consciously or unconsciously.
However, I simply cannot imagine that a majority of this Chamber would wish to be responsible for such a tragedy or even that all the members of the Opposition would seek such responsibility if they realised what the danger was. What it comes down to is that the opponents of the Single European Act are really opponents of the whole European idea. They are thus necessarily opponents of all steps over the years that have sought to arrive at greater unity of action among the Western European democracies, which otherwise, as we all know, may well in effect become the satellites of one super-power or the other. Hence, they must be opposed to the advances made in Luxembourg in 1970, in Copenhagen in 1973, in London in 1981 and, above all, in Stuttgart in 1983, to say nothing. of course, of the advances towards co-operation in the foreign political field that have gradually been made under the aegis of the Council of Foreign Ministers over many years.
All these advances, restricted though they were—and I personally wish that they had been greater—took us a little further on a road toward a valid decision-making machinery, the absence of which, as almost everybody who knows anything about European matters realises, has been the reason for the admittedly disappointing performance of the European Community up to now in the economic sphere. All this the opponents of European unity cannot accept for one reason only. They apparently believe that no such progress can be made without some infringement or limitation on what they always refer to as the sovereignty of this nation.
Let us, however, for a moment try to consider the matter dispassionately, without blind recourse to patriotic emotions which obscure the real issue and darken our counsels. It has never, from the start, been a question of our joining a federation in the accepted sense of the term, namely, a number of states which join together with a common parliament or congress to which the executive is normally, at least in some degree, responsible: a President or Prime Minister in total charge of the government: a federal army; a federal police force; a common language; great central ministries, including a Ministry of Foreign Affairs with common diplomatic and consulate services; and a common judiciary with very extended powers. All those things are necessary and inherent in any federation. Under such a system it is indeed true that our ancient institutions would be endangered and even the position of the Queen would become impossible. We do not dispute that.
I repeat that there has never been the slightest prospect of our joining any equivalent body, which, with the possible exception of Italy, would not be acceptable to our European partners either. It has, it is
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true, as an idea always found favour with a considerable number of European "federalists" as they are called, more especially perhaps by the Italians, a rather modified version of it finding expression during the past few years in Strasbourg in the shape of the so-called Spinelli proposals, the ultimate defeat of which was consequently regarded as a victory for the non-federalists, among whom in the forefront, were the British, who eventually succeeded in pushing through, as an acceptable alternative the Single European Act.
Why, in addition, did we regard it as a victory? Because the amendments to the treaties make provision for reaching decisions more rapidly and more effectively, thus enabling us, by and large, to expand the market and encourage our exports to the Community, to say nothing of ensuring that our services, and notably insurance, receive a far better deal than is at present the case.
It is true that our partners may also profit by the new system which provides, as we know, for a certain extension, in carefully defined circumstances, of qualified majority voting. Here again, the new system might sometimes make it easier to modify the common agricultural policy, which obviously stands in need of reform, and in addition it provides for the first time for policies which match the imperative modern need for progress in research and development. What we may lose on some of the swings we shall therefore gain on the roundabouts. The net result in any case is that everyone will gain because general agreement will be forthcoming.
As for the proposal made by the noble and learned Lord, Lord Denning, which relates to the court and about which he spoke so eloquently, I am afraid that the noble and learned Lord is living in the past. He is perhaps living in the days of Lord Palmerston, or even in the days of the "War of Jenkins' ear"! He is living a long way in the past. The powers of the court, the judgments of which have, under the Treaty of Rome, to be accepted by Her Majesty's Government along with all the members of the Community, were very fully explained to the British electorate on the occasion of the referendum in 1975. I remember making speeches to that effect and no doubt my noble friend Lord Diamond did also. It was then agreed by no less than two-thirds of the British people. Despite what the noble and learned Lord, Lord Denning, said, the powers have never been seriously abused. It is impossible, apart from being undesirable, to go back on that now. As for the subsidiary court machinery proposed under the Single European Act, that does not enlarge the court's powers at all to interpret legislation and so forth. It is simply designed to assist the court in its admittedly valuable work.
It must be evident from what I have said that the only sensible decision for the Committee to take today is to reject every one of the amendments now proposed, preferably without much discussion, on the simple grounds that all are designed, if not to destroy, at any rate to prevent any further improvement in the one constructive experiment in international co-operation that has been accomplished since the war.
I earnestly beg any of the Committee who may be wondering which way to vote not to be misled by any

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specious arguments about an alleged loss of sovereignty. I wonder what would happen to our sovereignty if we left the Community? Presumably we should once again soon be in the hands of the International Monetary Fund. What would happen to our sovereignty then? Anyhow, a directed economy would be something towards which we should soon be heading. I can understand that Socialists might find this an alluring prospect, but that it should come about as a result of Conservative support is something that I find very difficult to understand. I hope therefore that when they have heard the arguments those doubting Conservative members of the Committee will not support the amendments.
Lord Monson: Before the noble Lord sits down, is he seriously implying, as he seemed to do at the beginning of his speech, that the Committee has no moral right to pass amendments to the Bill even though it may collectively believe that some or all of the amendments are vital for the protection of the inhabitants of the United Kingdom?
Lord Gladwyn: We have a moral right to do anything, however foolish it is. All I said was that if the Committee passed the amendments we should not be able to renegotiate the document. It would fail and the consequences would stare us in the face.
The Earl of Bessborough: I do not want to repeat what I said on Second Reading, when there were 18 speakers. All these matters were considered in great depth then although the press quoted more of the noble and learned Lord, Lord Denning, and the noble Lord, Lord Bruce, than it did of the other 16 speakers. As many members of this place said then, this battle was fought 14 years ago. It was perhaps re-fought during the referendum. The decision was well endorsed by the referendum. I am sorry that the noble Lord, Lord Gladwyn, was not one of the 18 speakers because he has now made a most important contribution, with which I agree.
I should like to refer to the remarks made by the noble and learned Lord, Lord Denning, on the court of first instance. It has been clear for some years that something needed to be done to reduce the workload of certain cases before the existing European Court of Justice. As the noble Lord, Lord Gladwyn, said, we accepted its existence. I think that the noble and learned Lord, Lord Denning, is being unduly fearful. In its report on European union in July 1985, a Select Committee of this place agreed that the court's workload was excessive and increasing. Your Lordships' own Select Committee believed that the court should be relieved of the obligation to hear certain staff and competition cases at first instance. The committee stated that this would allow the court,
"to concentrate on cases which clearly raised issues of general importance."
The establishment of the new court, this court of first instance, for which the Single European Act, in Article 11, makes provision, does not involve any extension of the European Court's jurisdiction, merely a redistribution of its workload. The powers of the court could not be extended—I am sure that the noble and learned Lord, Lord Denning, who seems to have
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read all the documents, must realise this—without further treaty amendment which would have to be brought before this Chamber following unanimous agreement of all member states. It is in everyone's interest—all member states and everyone in the United Kingdom—to have the court working more efficiently. Reduced delays mean greater legal certainty. I strongly endorse therefore the establishment of this new court.
Lord Campbell of Alloway: I should like to make a contribution on the merits of this series of groupings, wholly related, as my noble friend Lord Bessborough has pointed out, to the establishment of an attached court that in no way alters the fundamental jurisdiction of the court at all. I wish to confine my observations to this issue on its merits.
What has happened, no more or no less, is that Ministers recognised at The Hague this year that it was impossible for the court to continue with its workload. As the court is responsible for maintaining the legal order of the three treaties by interpreting the primary and the secondary legislation where these provisions have supranational effect, there is an urgent and crying need to accept that if the legal order is under such a degree of strain, something has to be done about it; and something has to be done about it soon. That something has been agreed at The Hague. That, no more and no less, is—
The Earl of Bessborough: My noble friend means, I think, the council. The European Court meets in Luxembourg.
Lord Campbell of Alloway: I appreciate that the court is at Luxembourg. I have appeared in it on more than one occasion. I am talking about where the agreement was made. It was made at The Hague, if my noble friend will forgive me.
In these circumstances, dealing with the merits, to what avail is it to attack a system of justice that we have accepted by accession and that we have accepted for 14 years? To what avail is it to talk in emotive terms—we all feel that emotion—about our allegiance to the Queen? To what avail is it, in this context, to drum up the emotions? There was the partial surrender of sovereignty by the will of the people of this country some 14 years ago. We owe, of course, a primary allegiance to the Queen. But we also owe some allegiance to the surrender of sovereignty that we accepted in order to make the system of Europe work. To what avail is it in these circumstances to make what I say, with the greatest respect to the noble and learned Lord, is an emotive and ill-conceived speech?
I am dealing only with the merits of attaching a court. Are we to frustrate the working of the treaties by hobbling the development of the only institution responsible for maintaining the legal order of a system that the people of this country have accepted? I accept with gratitude the whole approach of the noble Lord, Lord Gladwyn. It squares totally with mine. What is there to be done, our Government having agreed with other governments that this further court is necessary? It is far worse than a diplomatic impasse or diplomatic disaster of the greatest magnitude. If we do not accept the proposal of a more efficient system for operating

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the court of first instance, the other member states will, at the end of the day, say, "Are you in with us? Or are you going to be the odd man out in Europe? Are you going to be up to your old tricks again?"
It is an economic problem. The survival of this country depends on our remaining in the Common Market. If we are to make sense of our membership and pull our weight in this organisation, it is idle to pick at an agreement made by our Government with all the other governments, all of which accept that this is a proper step to take.
4.15 p.m.
Baroness Elles: In supporting very much the remarks of the noble Lord, Lord Gladwyn, and my noble friends on these Benches, I wonder whether I may address myself to the details of the comments made by the noble and learned Lord, Lord Denning. All of us have much respect and indeed admiration for the noble and learned Lord but are somewhat in doubt as to some of the comments that he made in his eloquent speech.
The noble and learned Lord referred to the overloaded European Court of Justice. That is, of course, perfectly right. I obtained the figures yesterday from the registrar of the European Court of Justice in Luxembourg. The number of staff cases alone coming before the court last year amounted to 65. And already this year, up to July, there had been 42. In a recent report, now before the European Parliament, the delay in hearings was shown to be something like 10 months for direct actions and approximately two-and-a-half months merely for preliminary rulings. If one considers the enlargement of the Community through the accession of Portugal and Spain it is expected that there will be delays of something like 20 months for a case and 16½ months for preliminary rulings.
The noble and learned Lord, with all his knowledge of the laws of England, can go further back than a bill of rights. He can go back to the Magna Charta. He will remember the famous saying that justice delayed is justice denied. Surely he would not deny British subjects having their rights protected and guaranteed in a European court. That would be extraordinary, knowing, as I do, the noble and learned Lord's immense contribution to the development of English law in the field of the protection of rights of individuals. I was therefore a little surprised to hear his remark that British subjects should not be able to go to this court. Surely we should be thankful that within a Community based on the rule of law, our British subjects can expect that their rights will be guaranteed within a decent time limit—with the prospect of an even better service—in the attached court.
I was a little sad that the noble and learned Lord should have been derogatory in his references to European judges. Surely he, in his great standing in this country, must have come across many brilliant and learned judges of other countries within the Community. That was a statement which I hope he would feel he could not maintain when one considers the many brilliant lawyers in the field of human rights and justice for which the whole of Western Europe stands.
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I was particularly sad because the president of the European Court of Justice is no less a person than our own British nominee, Lord Mackenzie Stuart, who presides over the European Court with such distinction. It was because of his knowledge of law, and his standing in Europe as a lawyer, that he was elected unanimously and with acclamation as president of that court, and has been so for the last four or five years to my knowledge. I say these words with some sadness at the way in which the noble and learned Lord has addressed this matter. I understand his emotion and concern for the rights of British subjects, but I think we have to look at this matter in the current situation, as other noble Lords have said. We have been in the Community for 13 years. We have had decisions from the European Court during the last 13 years. British subjects have had the right to go to the European Court for the last 13 years. Surely British subjects will not be stopped in the future from going to a court which is to be only of first instance and will have exactly the same powers as the other main court.
Finally, I should like to remind those noble Lords who perhaps feel that we should not have this court that it was in this very building—
Lord Somers: No.
Baroness Elles: Perhaps I may continue this one sentence if noble Lords will allow me. In conclusion, it was in this very House, when we were discussing competition procedure, that it was recommended in the report of the European Communities Committee published in February and debated in this Chamber in April 1982, that we should be investigating the possibility of setting up a first instance court to deal with competition cases, particularly those that come under Article 17. Nobody will accuse the noble and learned Lord, Lord Scarman, of being particularly pro-government or pro-anybody. I well remember the noble and learned Lord saying that this would require an amendment to the treaties and therefore at that stage he would not propose that we should have that court.
With those words I hope the noble and learned Lord, Lord Denning, will feel, despite his eloquence, that we who want to see this first instance court established will recognise that it is for the benefit of British citizens and not to their detriment.
Lord Somers: I quite agree that the courts which we shall have are of the greatest importance. However, surely the noble Baroness would agree that even more important is the law under which those courts will operate. In future we shall not be subject to British law but to European law.
Baroness Elles: If noble Lords will allow me to reply to that statement, we are already members of the European Community, since 1973. The European Communities Act 1972 recognised the decisions of the European Court of Justice. Therefore the position does not change at all. The first instance court will not have any further powers than those of the present court. That has been guaranteed and underscored, not only in the Single European Act but by every member state.

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No member state would give new powers to the court other than those it already has.
Lord Kennet: Perhaps I may add to what my noble friend Lord Gladwyn has said on the general debates this afternoon. I believe that no argument will be advanced in favour of these amendments today which is not also an argument against the 1972 European Communities Act. A decision has been taken by this sovereign Parliament to join the European Community. What we face in this Bill is no more than a development and consequence of that decision.
The noble and learned Lord, Lord Denning, with his usual skill conjured a vision of an infringed Royal prerogative, and of a damaged allegiance among the subjects of Her Majesty the Queen. If Her Majesty the Queen were to command me on my allegiance, or any noble Lords on their allegiance, to do this or that—for instance to pass the amendment proposed by the noble Lord, Lord Bruce—that might shake us. But she has not done so; and noble Lords on all sides of the Chamber will have noticed that for the last three centuries successive sovereigns have been careful not to command either House of Parliament on their allegiance to do this or that. I believe that allegiance to our sovereign is very much bound up with our parliamentary form of government. We must remember that this Parliament has three estates. That in my view is the way to look at the question of allegiance to the sovereign.
Lastly, if I may add a note of reality, several speakers have asked us to confront our minds with the apocalyptic consequences of amending this Bill. The mighty wagon in Brussels will roll forward and tiny Britain will be crushed by the advancing forces of progress. I think the first thing that would happen would be that we should be overruled in the House of Commons.
Lord Nugent of Guildford: I should like to add one point which I think is relevant especially to the earlier speeches. There is a suggestion that there has not been sufficient information on this very important matter—I certainly go along with that; that the House has not been kept sufficiently informed, and that there might even be something furtive in the way the Government have handled it. I want to call attention to the two reports of the Select Committee that we have had on the subject—one last year and one this year. We also had the debate at the end of July when the noble and learned Lord, Lord Templeman, who was chairman of the Select Committee concerned, made the most cogent and authoritative speech analysing the proposals in detail and leaving no doubt whatsoever that the balance of advantage lay in accepting these proposed amendments.
My noble friend Lord Campbell of Alloway has called our attention to the fact that what is proposed here in the way of addition to the courts is a very small addition of attached courts, with various safeguards which I do not propose to expound now. The noble and learned Lord, Lord Templeman, dealt with these in great detail, as does the report. We have all had the opportunity of reading and studying the report. Many of us also had the opportunity of hearing the noble and
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learned Lord, Lord Templeman. There can be no doubt to anyone who is in favour of our remaining as a member of the Community that this proposed new machinery of a certain measure of delegation, which is very carefully set out, will on balance be to the advantage of the whole Community in accelerating the completion of the internal market and is therefore very much to the benefit of our country also.
I have almost made a Second Reading speech but I think that we have got into that situation already.
Viscount Caldecote: There is an important sentence in the report of the Select Committee on the Single European Act which I should like to read to Members of the Committee and then make one or two comments. The report says:
"This streamlining, if successful, will increase the extent of Community law and thus Community competence—that is, the area subject to Community law rather than national law—at the expense of Member States."
It happened that I was listening to the "Today" programme this morning on the BBC when the Prime Minister was being interviewed. In her usual forthright way she said that we must fight for what we want to retain, and in particular we must fight for the freedom we have in this country under the law of the land and the common law administered by our judges. I paraphrase because I did not take it down, but that is more or less what she said. I agree with that. The noble and learned Lord, Lord Denning, has made clear to us that those freedoms are very important. The noble Lord, Lord Gladwyn, and other noble Lords have tried to frighten us with the idea that there is no alternative but to pass this Bill as it is and not to amend it. I do not take that view. If we believe it is right to amend it, then it should be amended and returned to the other place.
I do not believe that the Bill was fully considered in another place. It was guillotined. I am more certain still that the great British public do not know, or fully realise, what is being done in their name. If the people want this change to lose further sovereignty, so be it. There may be strong arguments in favour of it, and it is a highly complex and difficult matter, but I do not believe that the British public, as a whole, fully appreciate what is being done in their name. If there were ever a case for this Committee passing an important amendment, such as Amendment No. 42 in the name of the noble and learned Lord, Lord Denning, and so returning the Bill to another place for further consideration and giving time for public opinion to form, I believe that this is one of those cases. In spite of what has been said, I believe very fervently, or I would not be standing on my feet today, that more time should be given for public opinion to form. I therefore support Amendment No. 42.
4.30 p.m.
Lord Houghton of Sowerby: In view of the trend of this debate, and the absence of speeches from noble Lords, I feel that I must be true to my own firm belief in European unity and the work that I have done towards it over the years, and say that I fully support the Bill and oppose all the amendments. I do this in no proud spirit. I must confess that I have been acutely disappointed at the ambivalence of the Labour Party over their membership of the EC for a number of

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years. I hoped that the referendum had ended that, but it has not. Indeed our record as a country in the European Community is not a very proud one. I believe that this Bill is as inevitable as it is desirable if the concept of European unity is to go forward. Much that we have heard from the noble and learned Lord, Lord Denning, this afternoon was brought into the debate at the time of our entry in the first place. In large measure this was the note of deep national pain which was expressed by those who will be bewildered and saddened by some strange concept of the monarchy in the world of tomorrow.
However, the completely autonomous state is an obsolescence in the world today. We know that European unity is as essential to prosperity, to peace and to the concept of co-operation throughout the world, as many other associations that we have to make to the same end among other nations. I feel that we must support this Bill. To do anything other than ratify the agreement upon which this Bill rests would be an additional setback to the confidence that our European partners have in this country as a member of the EC. I think that would be a great pity.
We ought now to think of tomorrow and the years to come. It does not lie in the retrospective concept of British history, the sovereignty of the monarch, the sovereignty of Parliament or the sovereignty of Britain. All these have to be put in the pool of the world of tomorrow, if we are to live in amity and prosperity. Otherwise we shall continue the wars, the animosities and the conflicts of the past. In those circumstances, I hope that this Committee can raise its eyes to the ultimate goal of all that we are trying to do in this way and is not misled by the distractions of mechanism and of tiresome detail that may be related to the administration of parts of the European Community.
We do not denounce our legal system because of the delays that occur in getting there and getting justice from it. We have had many complaints about that, but our faith in the system is strong. Our faith in the European system should be strong and it should be adjusted as required. For my part, I register my deeply-held personal conviction in favour of Europe and this Bill, and that absolves me from any disciplines that might otherwise be laid upon me by noble Lords.
Lord Beloff: Is it not surprising that from these Benches someone should have endeavoured to quote the Prime Minister in opposition to the principle of this Bill? This Bill is the result of negotiations carried on by the Prime Minister as the senior statesman in Europe, with her colleagues. It is unimaginable that the Single European Act would have been put before us but for the support of the Prime Minister. In an afternoon of topsy-turvy argument it seems to me that to quote the Prime Minister against the principle of this Bill goes very far.
On the other hand, if I may try to reconcile myself with my noble friend, I have some sympathy with the view that the British public are entitled to know about the proposed changes that will be made by the Bill now before us. The fact that this has not been done is, at least, in large measure the result of deliberate actions
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by the Bill's opponents. When I was quoted by the noble and learned Lord, Lord Edmund-Davies, at least I think it was I who said in the Second Reading debate, that this was a very modest Bill. That is true. It contains a number of provisions of different degrees of importance which modify the arrangements we entered into 13 years ago.
If the opponents of the Bill had produced amendments directed towards those changes alone, even if not successful they would at least have done what they believed to be their duty, that is, they would have enlightened the public as to its contents. However, by producing instead a series of amendments, which, if plausible at all, would relate to an Act which became law in 1972, they have done nothing but further confuse the public mind and have not played the educational role which they say, and perhaps rightly, it is the duty of this Committee to perform. Because of this, I think that inevitably we are having another Second Reading debate, because if amendments to a Bill challenge not only the principles of the Bill itself, but the principles of the preceding legislation on the statute book, what can we do but say: "This is out, noble Lords; this is out"?
Lord Kilmarnock: It really was rather extraordinary to hear the noble and learned Lord, Lord Denning, whom we all respect so much, arguing along the lines he did, considering his own distinguished contribution to the assimilation of Community law into the law of the land. Once we joined the Community, and reaffirmed this in 1975, there really was no alternative but to respect the paramountcy of Community law in its proper sphere. It was in this spirit, surely, that the noble and learned Lord forged his judgments in such cases as Macarthy v. Smith (1980) and Worringham v. Lloyds' Bank (1982). But if we want explicit and graphic illustration of the views that the noble and learned Lord, Lord Denning, previously held, and want to set at rest the fears he now strives to raise, we should go back to the case of Bulmer v. Bullinger (1974) when the noble and learned Lord said. [All England Law Reports 1231H]:
"The treaty does not touch any of the matters which concern solely the mainland of England and the people in it. These are still governed by English law. They are not affected by the treaty. But when we come to matters with a European element the treaty is like an incoming tide. It flows into the estuaries and rivers; it cannot be held back. Parliament has declared that the treaty is hereafter to be part of our law.".
None of that has changed. Today we see that tide in the estuary just as was then envisaged by the noble and learned Lord. We are simply asked to ratify what the Government have already put their hand to—that is, to enable some decisions to be taken by majority vote and to improve the speed of rulings relative to a number of articles in the commercial sphere, which was referred to by the noble Baroness, Lady Elles, while reserving sovereignty on issues of major need as defined in Article 36 of the Treaty—that is to say, matters such as public health, morality, environment and terrorism.
Finally, let us put this in perspective. the Single Act is merely the residue of a much more ambitious draft Act of Union to which we did not put our signature and to which my noble friend Lord Gladwyn referred. This represents no more than the lowest common

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denominator on which the Council of Ministers has been able to agree to make Europe a more effective trading community, and which, incidentially, as I understand it, has the full backing of the CBI. Surely it would be a retrograde step, and one against both our treaty obligations and our economic interests, to pass any of these amendments. I urge the Committee to reject them.
Lord Hughes: When the noble and learned Lord, Lord Denning, made his speech he said that if anyone had only the Bill and the amendments he could not possibly understand what this was about. As these are the only documents that I have, if I have the matter wrong, I must plead that in my defence. However, I do not think that I have got it wrong because of consultations which I have had in the interval. When the noble and learned Lord, Lord Denning, constantly referred to the law of "England", I thought it was just the usual mistake which people made when they meant the United Kingdom, and that they thought the two were the same. However, I lost that idea when the noble and learned Lord read Amendment No. 42. The noble and learned Lord read it in its entirety and I shall repeat the subsection (2):
"In lieu of the jurisdiction of any such attached court, every British subject"—
not every English subject—
"resident in the United Kingdom and owing allegiance to Her Majesty the Queen shall be entitled to the protection of Her Majesty, according to the law of England, administered by Her Majesty's Judges, sitting in the Royal Courts of Justice under the Rules of the Supreme Court".
I realised then that when the noble and learned Lord said "England" he was not making a mistake, and that he was talking about the law of England. Therefore, being totally ignorant on legal matters, I took the precaution of having a few words with the noble and learned Lord the Lord Advocate. I asked whether I was right in thinking that if this amendment were agreed to, the judges in Scotland would be of no importance whatever. The reply of the noble and learned Lord the Lord Advocate could not have been stronger; he said that this was entirely contrary to the Act of Union.
Given the fact that the noble and learned Lord, Lord Denning, has raised the matter as a constitutional issue, I cannot imagine a greater constitutional impropriety than for the noble and learned Lord, by a single amendment to a Bill which he does not like in any event, to tear up the Act of Union as it affects the legal system of Scotland. Whatever else may happen, I am quite certain that no Scot present in this Committee could possibly vote for Amendment No. 1. If voting for Amendment No. 1 implies a commitment to Amendment No. 42, then I cannot vote for any of the damned amendments!
4.45 p.m.
The Duke of Portland: Being, I believe, the only person still alive who participated in the Locarno Conference of 1925, which may be regarded as the first serious effort to bring together the people of Western Europe—I was Secretary to the British Delegation—I venture to address the Committee.
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The first objective of that conference was to bring Germany back into the comity of Western Europe after the 1914–18 War and to bring the nations of Western Europe closer together. The statesmen who took part in the discussions at Locarno fully realised that any organisation for cohesion was a long-term objective, but it was an objective that they all had in mind under the leadership of two real statesmen in foreign affairs, Austen Chamberlain and Aristide Briand.
The seizure of power by Hitler put this rather utopic idea out of the picture, but in due course it reappeared very tentatively when the European Steel and Coal Community was founded in Luxembourg. This was followed by Monsieur Monnet's proposal for the European Economic Community, in which, unfortunately, His Majesty's Government did not believe and thought that participation might seriously damage our close relations with the United States and the Commonwealth. Had we taken part in the early negotiations for founding the European Economic Community, it might have been possible to give this organisation a form better suited to our needs. For 36 years the Community has battled on, and the document before the Committee comprises the amendments which have been found necessary after years of experience.
The allegation that Her Majesty's Government are pushing through the measure now before the Committee in a somewhat clandestine manner is to my mind rather far-fetched. The Single European Act was submitted to the House of Commons in December last, reported on by the House of Commons Foreign Affairs Committee in June this year, passed after debate in the House of Commons in July this year and given a First Reading in your Lordships' House on 10th July, the Select Committee on the European Communities having submitted its report on 6th May last.
That this measure has aroused limited public interest is not the Government's fault. I have read little in the press on this subject and television debates have been few. We are now asked to postpone further consideration of this Single European Act in order to give the public an opportunity for full consideration of the implications of this measure. This measure is only the natural outcome of our joining the European Economic Community, and, while it imposes certain limitations on our freedon of action, on the other hand it increases the efficiency of the Communities' mechanism and affords the elected Parliament a measure of real power.
From what I have seen and heard of the Parliament, this body does not fill me with admiration, although, charged with some responsibility, it may well improve. Moreover, the new procedure is heavily circumscribed so that all decisions will be left to the Council of Ministers. Should the Committee decide to postpone this measure, I very much doubt whether it would have much effect on public feeling, but abroad it would be viewed with dismay and I fear, a measure of contempt.
Lord Denning: I fear that I have not made myself clear. I cannot have done so because it is a trick of advocacy to put on your opponent's lips an argument

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which he has not put forward and then to destroy that argument. Perhaps I should say that I have never sought in any way whatever to wreck the Common Market or European law. To attribute to me any desire to wreck it or to impede it in any way is a complete misconception.
All I have done and suggested in my Amendment No. 42 is to let the Community law remain, let it continue and, to use a metaphor, flow over England; let the Community law be there. Let the Community remain intact. All I have said is that if British subjects are affected by it, let the dispute be decided in a British court: that is all. In adhering to their law and everything in the Community I have only said that I agree and would affirm all the rights of Englishmen, but I do not want them to go against European law.
The Committee has to remember, and I have said in judgments, that Community law is part of the law of England. When any case comes before the British courts it has to be enforced, just as with our law of England, because it is part of our law. I am not against Community law or any of the legislature. I am merely suggesting almost a procedural matter: when there is a dispute between two great English companies about whether there has been unfair competition, or whether there has been an abuse of a dominant position, they need not go to Europe for it to be decided; let it be decided by the British courts. That is quite clear in subsection (3) of my amendment:
"a like jurisdiction shall be exercised by Her Majesty's Judges also to decide them according to Community Law".
Please do not misrepresent my argument. Please do not think I am attacking the Community, its law, its machinery or anything at this stage. All I am saying is that in a dispute between two British subjects. even according to Community law, we should not necessarily send them overseas but let them go, as they have for centuries, to Her Majesty's judges to decide.
I am afraid that many of the criticisms lodged against this small amendment were mistaken in that they attributed to me arguments and views which I have never held. I support the Community and Community law, as always. I just want our British subjects, when a dispute affects them, to be able to come to our Royal Courts of Justice.
Lord Hughes: When the noble and learned Lord, Lord Denning, came to the word "British" he waved his hand towards me. Does that mean that he intends to reword Amendment No. 42?
Lord Bruce of Donington: I have not so far taken any part in this controversy that seems to have broken round this series of amendments. Perhaps I should inform your Lordships that I shall decline to be inhibited from what I have to say by any noises off from a sedentary position by those who have not addressed themselves to the essence of the amendments.
My task today is to endeavour to explain and inform. I do not propose to take any part in the partisan debate that seems to have developed as to whether the EC is a good thing or not. This is not the point of the amendments and is not the point of the
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argument that has been put forward by the noble and learned Lord, Lord Denning. I was very pleased indeed that out of the many speeches that fell from the lips of your Lordships at least two of them addressed themselves to the matters the noble and learned Lord. Lord Denning, was endeavouring to lay before the Committee. I should like to say with all due deference to the noble Lord, Lord Gladwyn—for whom I have a profound personal respect and whose experience I very much admire—that it is not part (at any rate in my view: the Committee may think otherwise) of a debate on the merits of essentially legal amendments to start out into the broad general discussion that any amendment would automatically kill the treaty and inviting the Committee to reject them all on purely emotional and obviously shaky grounds. This does not seem to get us very far at all.
Some observations have been made about the Continental legal system. Reference has been made to the courts of first instance. The noble Baroness, Lady Elles, referred to it in connection with the competition laws that are enforced under the direct authority of the Commission. What possibly may not be realised in the United Kingdom is that the Commission itself in competition cases acts as a court of first instance and does not behave in any similar way to a court of first instance in this country. The Commission brings the case against the companies concerned. It summons the companies to attend, the proceedings are alleged to be informal and they are partly formal and partly informal. There is no possibility of producing witnesses and having them examined under oath so that their evidence may be proved, as in the case of courts in the United Kingdom.
Lord Campbell of Alloway: There is a hearings regulation and there is a full procedure for an oral hearing. Although there is something to be said for the criticism, it is wrong to overstate it.
Lord Bruce of Donington: I am most grateful to the noble Lord, Lord Campbell of Alloway, who always puts his points very persuasively. I can only say that my experience is the opposite. I cited to the Committee, and I was not challenged by the Minister, the famous case of the Hasselblad company. If the Committee reads through the reports on that case, they will be shocked because the Commission heard the case, imposed the fine and the appeal went to the European Court of Justice.
It may not always be realised, especially those of us who are familiar with the procedure in the British courts, that the business of establishing evidence and hearing arguments in the European Court of Justice (I am not criticising, I am merely saying that it is different) is not the same as we have in the United Kingdom. The cases are submitted to the court by way of written depositions from the Commission, from the parties and very often from the governments concerned. They are then considered by the Judge Advocate or by the advocate advising the court who then prepares an advice for the court as such. The court then proceeds to oral hearing for the delivery of oral arguments.

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This procedure might possibly appeal to members of the British Bar, but I am not sure because I am given to understand, especially by those who occupy august positions in the law, that daily refreshers are very welcome, particularly for those who are Queen's Counsel, let alone the juniors. So they may not take kindly to the procedure in the European Court of Justice whereby, in advance, the amount of time to be spent on a particular case is laid down from the commencement, and the registrar says, "This case is going to take two hours". However eloquent the arguments, however contested the various legal arguments may be, that is the time. This is not the same as in the British courts. The sole argument this afternoon should have been as to whether we wish the sovereignty of people in the United Kingdom to be infringed in any way by the operation of the European courts themselves. This is the issue. It is no question of—
5 p.m.
Lord O'Hagan: Is the noble Lord saying that he wishes to repeal the European Communities Act 1972 and that this country should immediately leave the European Community?
Lord Bruce of Donington: That raises a point that I was not going to deal with unless I was reminded of it. However, I am glad that the noble Lord, Lord O'Hagan, has raised it because the 1972 Act of accession was passed and, as was said, was approved by a majority in the subsequent referendum on the specific undertaking which will become the subject of a later amendment (which I hope will be discussed resolutely when we arrive at it) on the basis that any British national interest was fully protected. The 1972 Act was passed and confirmed in 1975 exactly on the basis that the national interest would always be protected by the veto. That is the difference between then and now: because now we have the experience that the veto is useless.
I have no desire to go down that road. I want merely to deal with the particular arguments which have been put forward on the legal side. I was particularly grateful for the intervention of the noble Lord, Lord Caldecote, who, in my view, whatever derisory noises were made throughout some sections of this Chamber, put the point of view quite correctly that the British public have not been informed about the full import of this Bill. I decline to accept the proposition put forward by the noble Lord, Lord Beloff, that it is somehow due to those who are putting down amendments to this Bill that public confusion has arisen.
There is no public confusion about it. Until the last three days the Government might have issued a D-notice against the media and against the press because it has not even been mentioned until the past two or three days. When the noble Lord, Lord Beloff, has been with us a little longer he will know perfectly well that not all amendments are put down for the purpose of being contested in the Lobby. It is the one way of eliciting the information that is required or ought to be required by the Committee and it is one way of eliciting information by the replies that come from Ministers as to what exactly is the purport of the Bill.
Baroness Elles: I would be most grateful if the noble Lord were to give way. Would he accept that on the whole the media deal only with bad news and that perhaps they thought that the Single European Act was good news for the British people.
Lord Bruce of Donington: The noble Baroness invites me to share in or comment upon her subjective emotions. I am not really in a position to do that. I am not talking about good news or bad news although I am bound to say, as the noble Baroness tempts me—and I have not detained the Committee for very long although I think the noble Lord, Lord Gladwyn, also is now tempting me to do so—that, if it is the noble Baroness's wish or the wish of noble Lords that I should detain the Committee then, so long as I remain within the rules of order and so long as what I have to say is relevant and directed to the Bill, I am delighted to comply with the opportunity and shall do so at the slightest invitation. So let us have no nonsense about that.
I am not concerned with whether this is good news or bad news but the noble Baroness tempts me here and I shall depart from the amendment for one brief moment only—unlike practically all the rest of the Members of the Committee who have spoken who departed from the amendment totally from the beginning of our discussion of it. I shall say this: that within the next year, in fact within the next months, we are going to have bad news in this country. We are going to have very bad news indeed. Unless we are very careful, we are nearing one of the greatest national crises in financial and economic terms that we have experienced for a very long time. The noble Baroness has brought me to the point.
That is my view—and I wish to do everything possible in conjuction with our European allies and with our American allies and with any allies that we can get; for I am all for co-operation on a willing basis. But the time is coming when we shall have to take independent decisions in this country in the interests of the citizens of this country. When that occasion arises, perhaps the noble Baroness will remember that it was some of us here who urged that we should look after, first of all, our own national purposes, our own national unity and retain our own national resilience in dealing with the problems from which we shall probably suffer to a far greater extent than a number of countries that are more favourably placed.
I am sorry to have detained the Committee for three minutes for that peroration—but I think that it was called for—from some of what I may describe with, respect, Second Reading speeches that we have had this afternoon which were unrelated to the particular amendment. I invite the Committee to support the amendments which have been moved by my noble and learned friend Lord Denning.
Baroness Young: I hope that even the noble and learned Lord, Lord Edmund-Davies, will feel at the end of the debate on Amendment No. 1, which has now lasted 89 minutes, that we have had a very fair and complete discussion of the issues involved. That has always been my wish, as it has been the wish of the Government, and I am very glad that we have heard from so many Members of your Lordships' House.

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May I start by referring to the noble Lord, Lord Bruce of Donington, and say that I was very grateful to him for his agreement on the grouping of amendments. I think that it is helpful in this connection that we are able to speak to the group of amendments on the court of first instance.
Perhaps I may say to the noble and learned Lord, Lord Denning—and like every other Member of your Lordships' House, I share in the admiration of his distinguished legal career and in the affection in which he is held not only in this House but outside—that I agree that it is a complex piece of legislation.
I am not a lawyer but, in the course of my political life, I have had a lot of experience in having to take Bills through the House either in government or in opposition. and I have never found this anything but a difficult matter. On this occasion it was difficult but no more difficult than many other Bills before this Chamber. In almost every case, you pick up the Bill, you pick up the amendments and you find that the first thing you have to do is to look to see to what the Bill refers—which is usually another Act of Parliament. In this case, it is the Single European Act and of course we have had the great good fortune of the benefit of the numerous, very valuable Select Committee reports from the House.
Yes, it is complex; but I believe that we have had ample opportunity to discuss it, as we did in another place. I am sure that all who have taken part in debate when the occasion has presented itself have tried to explain the matters that are involved in this Bill to the British people; because, as my noble friend Lady Elles has said, they are good news for the British people. It will be much to their advantage, and in the course of these debates I shall spell this out.
I also answer the point made by the noble Viscount, Lord Caldecote—which was well answered, if I may say so, by my noble friend Lord Beloff—by repeating the view of my right honourable friend the Prime Minister of this Bill. I quote what she said in another place on 5th December 1985 when she reported on the agreement on the Single European Act which was reached last year. She said at col. 430 of the Official Report:
"they [the changes] will be an important step towards enabling this country to realise more fully the benefits of our membership of the European Community".
Let me also say how grateful I am to the noble Lord, Lord Nugent, for drawing our attention to the valuable contribution made by the noble and learned Lord, Lord Templeman, on Second Reading. Most of all, I am pleased that this Bill has received all-party support—from the noble Lord, Lord Gladwyn, for the Liberal Party and the noble Lord, Lord Kennet, for the SDP. We all listened with great interest to the intervention by the noble Lord, Lord Houghton of Sowerby, who spoke from the heart and I think spoke for many of us. I was particularly interested in the intervention of the noble Lord, Lord Hughes, who emerged almost in a skirl of pipes and drums, anxious to set us right about the position of Scotland, including the Act of Union. I should like to thank all my noble friends who have supported the Government in this very important group of amendments before us, to which I now turn.
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In describing the provisions of the Single European Act as they relate to the proposed court of first instance I start by referring to the report of your Lordships' Select Committee on European Communities on European union, which concluded over a year ago:
"The Court's workload is already excessive and increasing. The Court has made repeated but unsuccessful requests to the Council of Ministers to reduce its burden by creating special tribunals to deal with the staff and competition cases. The Select Committee believe that the Court should he relieved of the obligation to hear such cases at first instance. This would allow it to concentrate on cases which clearly raised issues of general importance".
The recommendations for the Select Committee were very much in the Government's mind when we negotiated the provision of the Single European Act covering the proposed establishment of the court of first instance. The workload of the European Court has grown threefold over the last 10 years, and my noble friend Lady Elles gave us some very impressive figures of the workload over the last six months. Between 1983 and 1985 the number of cases nearly doubled and more than half of those concerned the terms and conditions of staff employed by Community institutions.
It makes sense to relieve the European Court of Justice of the burden of hearing these cases. The court of first instance will be able to take on that burden but—and this is a very important point—it will not take on new work. Let me make that quite clear. And nor will it have new powers. I hope this answers satisfactorily the point raised by the noble Lord, Lord Somers. It will not hear cases brought by member states; it will not hear cases brought by the institutions of the Community; and it will not hear cases referred to the European Court of Justice by national courts such as the cases to which the noble and learned Lord, Lord Denning, referred at Second Reading: the Conegate and Marshall cases.
Indeed if I might just turn to Amendment No. 40 in this group, that is one of the matters which are all specifically excluded from the jurisdiction of the new court by the Single European Act. The maximum extent of its jurisdiction would be those cases which individuals and companies can under the present rules take directly to the European Court. There will in any case be a right of appeal on points of law from the court of first instance to the European Court. I hope the Committee will agree that this is a necessary practical improvement in the operation of the court.
I now turn to Amendment No. 7. Concern has been expressed at the provision in Article 12 of the Single European Act which allows the Council, acting unanimously, at the request of the European Court of Justice to amend the provisions of Title III of the Statute of the European Court. Concern has been expressed that this is a constitutional innovation providing for the Council to amend the Protocol to the Treaty of Rome without reference to the parliaments of member states.
That view is mistaken on two counts. First, it is not an innovation. The Council can already, under the existing treaties, increase the number of judges and advocates-general and make consequential amendments to the Statute of the European Court, and so this position is in line with existing provisions. Moreover, Title III of the Protocol on the Statute of

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the European Court deals only with the court's procedures and not with its substantive powers, composition or organisation. It deals with such issues as the conduct of hearings, who signs the judgments of the court and how costs are awarded. There can be no question of the powers of the court being changed under this provision. Such substantive changes could be made only by amendment to the treaty, requiring not only the unanimous agreement of member states but also the consent of national parliaments. This is a very important point to understand over the whole question of the extension of some kind of sovereignty of the European Court.
Some Members of the Committee have expressed concern that the reference in the Bill to any court which might be attached to the European Court of Justice implies that more than one subsidiary court could be created. That again is a misunderstanding of the reasons why the Bill is drafted in that way. The Single European Act does not itself establish the court of first instance. It enables the Council, acting unanimously, to establish such a court on a proposal by the European Court of Justice. No such formal decision has yet been taken, nor indeed could it be taken until the Single European Act is in force. It is therefore premature to talk about "the court" since the court of first instance does not yet exist. It does not have a name. "Any", therefore, is the correct term in the circumstances.
I turn now to Amendment No. 42. The noble and learned Lord, Lord Denning, has proposed in that amendment a new clause. The first subsection provides that the court of first instance should not sit in the United Kingdom or exercise any jurisdiction over the citizens of the United Kingdom. Since the court of first instance would be attached to the European Court, it is logical that it will sit in the same place; that is, in Luxembourg.
As to its jurisdiction, that will be no greater than the existing Court of Justice. But it would be quite contrary to the terms of our membership of the Community to suggest that the court of first instance should have no jurisdiction over citizens of the United Kingdom where the application of Community law is concerned. The European Court has such jurisdiction already and, as many have pointed out, the arguments advanced are 14 years too late.
The effect of this amendment would be to deny access to the court of first instance by British citizens who are servants of the Community and wish to bring a case against a Community institution and by individuals wishing to challenge decisions by the Commission in application of the competition policy. I am quite sure that the Committee would not wish to deny British citizens a forum in which to bring actions to enforce their legal rights and challenge executive decisions.
Let me turn now to subsections (2) and (3) of Amendment No. 42. The noble and learned Lord's proposed new clause appears to reflect the fears that he expressed at Second Reading: namely, that the new court would take over the jurisdiction to apply Community law currently exercised by the domestic courts of this country. I am glad to say that this fear is groundless. The new court's powers and jurisdiction
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are to be carved entirely out of the existing powers and jurisdiction of the European Court of Justice. It will not in any way take away the powers now exercised in this field by our domestic courts. The precise extent of its role remains for decision by the Council, acting unanimously. In no circumstances could its powers be greater than those the European Court of Justice already has.
Finally the noble Lord, Lord Bruce, put down Amendment No. 41, which would require the Government to lay before Parliament a report concerning the constitution, powers, personnel and activities of all courts attached to the European court. I believe this is an unnecessary requirement. The library of your Lordships' House already receives the official journal containing a summary of judgments of the European Court and copies of the weekly bulletin of proceedings of the court. The full particulars of a case are always available for the Treasury Solicitor's Department. We would expect the same procedure to be followed in the case of the court of first instance. I doubt whether an additional procedure is necessary, given that the court of first instance will have no new powers and will not be hearing classes of case not already heard in the European Court of Justice.
I have spoken at considerable length and I hope in a way which makes clear to the Committee why I cannot accept Amendment No. 1 or indeed the others grouped with it concerning the court of first instance. The noble and learned Lord, Lord Denning, spoke very eloquently to his amendments, if I may say so, on a number of issues which run contrary to the Treaty of Rome to which we acceded in 1972.
In his subsequent winding-up remarks the noble and learned Lord said that he had been misrepresented as saying that he was against Europe and that this was quite all right because it was only a procedural matter. I am not a clever lawyer like him, but I noticed in today's Daily Telegraph that he is quoted as saying that the purpose of the Bill before the House was to:
"transform Europe into a single nation with its own Parliament and its own legislation making its own law called community law".
If that is not his intention, I hope that in the interests of all your Lordships he will make it quite clear and perhaps write to the Daily Telegraph to correct what is clearly a misreport. However, if that is his concern, I hope that he will recognise that many of us in this Chamber—and I think I speak on behalf of all parts of the Committee—see this as a very important matter.
I conclude by saying why I think this Bill is so important. It is important because the Single European Act is about helping business and creating new employment; it is about making Europe competitive; it is about speakqing with one voice on foreign policy. If we were to take a different view we should not only be turning our backs on all we advocated in the past but we should be doing a massive disservice to the people of our country. This House has always led the way in wanting to make a success of our membership of the Community. Let us take our time and consider in detail these amendments. However, I hope that when the Committee has considered them it will accept the Bill. It furthers our aims in the Community, furthers our aims as a country and fundamentally helps all the people of this country. We need to see this Bill on the statute book.
The Deputy Chairman of Committees (Lord Cullen of Ashbourne): Does the noble and learned Lord wish to speak?
Lord Denning: I meant to speak a moment or two before. I do not know whether the Committee gives me leave.
Lord Denham: The noble and learned Lord does not need leave.
Lord Denning: I was going to say that I was grateful to the noble Baroness for saying how good it was to group these amendments together. My only comment is that she gave explicit assurances as to what is going to happen, which are welcome. I only say that her interpretation and ours do not matter. The interpretation is for those in the European Court of Justice and I only hope they will abide by the assurances which she has given to us. However, I feel this is such an important matter that I should like to test the opinion of the Committee.
5.25 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided; Contents, 52; Not-Contents, 176.

DIVISION NO. 1

CONTENTS

Beswick, L.

Liverpool, E.

Blyton, L.

Longford, E.

Briginshaw, L.

McCarthy, L.

Brockway, L.

Molloy, L.

Brooks of Tremorfa, L.

Monson, L.

Bruce of Donington, L.

Moran, L.

Caldecote, V.

Mountevans, L.

Carmichael of Kelvingrove, L.

Mulley, L.

Cledwyn of Pehrhos, L.

Munster, E.

Cross, V.

Phillips, B.

David, B.

Ponsonby of Shulbrede, L.

Dean of Beswick, L.

Prys-Davies, L.

Denning, L.

Ross of Marnock, L.

Erroll, E.

Sefton of Garston, L.

Fisher of Rednal, B.

Shannon, E.

Fitt, L.

Stallard, L.

Galpern, L.

Stoddart of Swindon, L.

Graham of Edmonton, L.

[Teller.]

[Teller.]

Taylor of Blackburn, L.

Gray, L.

Taylor of Mansfield, L.

Hartwell, L.

Underhill, L.

Jeger, B.

Wallace of Coslany, L.

Jenkins of Putney, L.

Wedderburn of Charlton, L.

Kagan, L.

Wells-Pestell, L.

Kirkhill, L.

Whaddon, L.

Lawrence, L.

Williams of Elvel, L.

Leatherland, L.

Wilson of Rievaulx, L.

NOT-CONTENTS

Airedale, L.

Boardman, L.

Aldington, L.

Bolton, L.

Alexander of Tunis, E.

Bonham-Carter, L.

Allen of Abbeydale, L

Boyd-Carpenter, L.

Alport, L.

Brabazon of Tara, L.

Ampthill, L.

Brentford, V.

Banks, L.

Brookes, L.

Beaverbrook, L.

Brougham and Vaux, L.

Belhaven and Stneton, L.

Broxbourne, L.

Beloff, L.

Bruce-Gardyne, L.

Belstead, L.

Buckinghamshire, E.

Bessborough, E.

Buckmaster, V.

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Butterworth, L.

Layton, L.

Caccia, L.

Long, V.

Cameron of Lochbroom, L.

Luke, L.

Campbell of Alloway, L.

Mackie of Benshie, L.

Campbell of Croy, L.

Macleod of Borve, B.

Carnegy of Lour. B.

McNair, L.

Chelmer, L.

Manchester, D.

Chelwood, L.

Margadale, L.

Chitnis, L.

Marsh, L.

Coleraine, L.

Marshall of Leeds, L.

Constantine of Stanmore, L.

Maude of Stratford-upon-

Cornwallis, L.

Avon, L.

Craigavon, V.

Mayhew, L.

Craigmyle, L.

Merrivale, L.

Craigton, L.

Mersey, V.

Cranbrook, E.

Molson, L.

Croft, L.

Monk Bretton, L.

Cullen of Ashbourne, L.

Montague of Beaulieu, L.

Dacre of Glanton, L.

Morris, L.

Davidson, V. [Teller.]

Mostyn, L.

De La Warr, E.

Mottistone, L.

Denham, L. [Teller.]

Moyne, L.

Derwent, L.

Newall, L.

Diamond, L.

Nugent of Guildford, L.

Dilhorne, V.

O'Brien of Lothbury, L.

Donaldson of Kingsbridge, L.

O'Hagan, L.

Dulverton, L.

Orr-Ewing, L.

Eccles, V.

Pender, L.

Eden of Winton, L.

Perry of Walton, L.

Elles, B.

Peyton of Yeovil, L.

Elliot of Harwood, B.

Plummer of St Marylebone, L.

Elliott of Morpeth, L.

Elton, L.

Portland, D.

Ezra, L.

Portsmouth, E.

Faithfull, B.

Reay, L.

Fanshawe of Richmond, L.

Reigate, L.

Ferrers, E.

Reilly, L.

Fortescue, E.

Rhodes, L.

Fraser of Kilmorack, L.

Ritchie of Dundee, L.

Gainford, L.

Rochdale, V.

Geddes, L.

Rodney, L.

Gisborough, L.

Romney, E.

Gladwyn, L.

Russell, E.

Glenarthur, L.

Sainsbury, L.

Gormanston, V.

St. Aldwyn, E.

Gray of Contin, L.

St. Davids, L.

Greenhill of Harrow, L.

Salisbury, M.

Grey, E.

Saltoun of Abernethy, Ly.

Grey of Naunton, L.

Sandford, L.

Grimond, L.

Seear, B.

Grimthorpe, L.

Seebohnm, L.

Hailsham of Saint Marylebone, L.

Shackleton, L.

Halsbury, E.

Shepherd, L.

Hampton, L.

Stedman, B.

Hankey, L.

Stewart of Fulham, L.

Hanworth, V.

Strathcarron, L.

Harris of Greenwich, L.

Swann, L.

Hemphill, L.

Terrington, L.

Henderson of Brompton, L.

Thorneycroft, L.

Hesketh, L.

Thurlow, L.

Hives, L.

Tordoff, L.

Holderness, L.

Trefgarne, L.

Hooper, B.

Trenchard, V.

Houghton of Sowerby, L.

Trumpington, B.

Howie of Troon, L.

Vinson, L.

Hughes, L.

Vivian, L.

Hylton-Foster, B.

Walston, L.

Ingrow, L.

Ward of Witley, V.

Kearton, L.

Whitelaw, V.

Kennet, L.

Wilberforce, L.

Kilmarnock, L.

Willoughby de Broke, L.

Kinloss, Ly.

Winstanley, L.

Kinnaird, L.

Winterbottom, L.

Kitchener, E.

Wolfson, L.

Knollys, V.

Young, B.

Lane-Fox, B.

Young of Dartington, L.

Lauderdale, E.

Resolved in the negative, and amendment disagreed to accordingly.
5.36 p.m.
Lord Bruce of Doningtonmoved Amendment No. 2:
Page 3, line 13, after ("Communities) "), insert ("but not Articles 6 and 7 thereof").
The noble Lord said: I beg to move Amendment No. 2 on the Marshalled List, standing in my name and the names of my noble friends, which seeks to delete Articles 6 and 7 of the Single European Act. Before asking the Committee to arrive at a decision on this matter, I shall venture, if I may, to inform noble Lords of the effect on the Treaty of Rome of Article 6. In the first instance, it seeks to amend Article 7 of the Treaty of Rome, which is one of the first series of articles forming the foundations of the Community.
The new Article 7, as amended by paragraph 2 of Article 6 of the Single European Act, will read as follows:
"Within the scope of application of this treaty and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited. The Council may on a proposal from the Commission and in co-operation with the European Parliament adopt by a qualified majority rules designed to prohibit such discrimination."
Since this is the first time within the context of the present Bill that majority voting has been referred to, and so that I do not have to refer to it again, it ought to be explained that the voting provisions following the accession of Spain, Portugal and Greece differ very considerably from those previously obtaining. There are a total of 76 votes available, out of which the United Kingdom has 10 and the other countries at the moment have as follows: Belgium, 5; Denmark, 3; Germany, 10; Greece, 5; Spain, 8; France, 10; Ireland, 3; Italy, 10; Luxembourg, 2; the Netherlands, 5; Portugal, 5. So the Committee will understand that the United Kingdom needs at least one other major state holding 10 votes—at least one major state and two others—in order to be able to avoid something being carried by a qualified majority.
Before this Bill was brought forward, Community voting was on that basis. Quite naturally, one has taken the continuation of this proportionate voting very much for granted. I shall not be talking about this again, but every time a qualified majority is referred to perhaps noble Lords will remember what I have said because it will save time. If all the votes of the 12 were to be redistributed on the basis of populations as distinct from the previous slightly arbitrary way, the United Kingdom would have 13 votes; Germany would have 14 votes; France would have 13 votes; Italy would have 14 votes; Belgium would have two votes; Denmark would have one vote; Greece would have two votes; Spain would have nine votes; Ireland would have one vote; Luxembourg would have one vote; the Netherlands would have two votes; and Portugal would have two votes. That would bring a drastic alteration in the balance.
At the moment, the United Kingdom, with a population greater than that of Belgium, Denmark, Greece, Ireland, Luxembourg and the Netherlands combined, has 18 fewer votes than those countries combined. It is for consideration—and I am putting it no higher than that—when we come to consider later aspects of majority voting that this revision ought to be looked at by the Council at its next meeting or ought
276
to be considered by the European Council or heads of state. I put this forward not in controversial terms but as a matter of which the Committee should be aware. At the moment, the voting system is unfair, on the basis of population, to the position of the United Kingdom.
Article 6 refers to Article 49 of the Treaty of Rome. Article 49 is in that section of the treaty—Title III of the Treaty of Rome—providing for the free movement of persons, services and capital. After amendment, the first paragraph of Article 49 will read as follows:
"As soon as this Treaty enters into force the Council shall, acting by a qualified majority on a proposal from the Commission in co-operation with the European Parliament and after consulting the Economic and Social Committee, issue directives or make regulations setting out the measures required to bring about by progressive stages freedom of movement of workers as defined in Article 8 in particular".
To save time, I shall not read the remainder of Article 49, but what I have read should be sufficient to give the Committee the concept of the effect of the amendment of the statute itself.
Paragraph 4 of Article 6 refers to Article 54 of the Treaty of Rome. The Committee will recall that Article 54 deals with freedom of establishment in the Community. This paragraph of the proposed Article 6 amends paragraph 2 of Article 54. It will now read:
"In order to implement this general programme, or in the absence of such a programme in order to achieve a stage in attaining freedom of establishment as regards a particular activity"—
this is the point that is put in—
"the Council shall, acting on a proposal from the Commission in co-operation with the European Parliament and after consulting the Economic and Social Committee, issue directives acting unanimously until the end of the first stage and by a qualified majority thereafter".
I trust that that will enable the Committee to see some of the impact of paragraph 4 of Article 6.
In Article 56 of the Treaty of Rome—this is also in the same section of the rules of establishment in the Treaty of Rome—the Single European Act proposes an amendment. This is the article which provides for the special treatment of foreign nationals. Paragraph 2 of Article 6 will now read:
"Before the end of the transitional period the Council shall, acting unanimously on a proposal from the Commission and after consulting the Assembly, issue directives for the co-ordination of the aforementioned provisions laid down by law, regulation or administrative action".
The new words put in by the Single European Act read:
"After the end of the second stage, however, the Council shall, acting by a qualified majority on a proposal from the Commission and in co-operation with the European Parliament, issue directives for the co-ordination of such provisions as in each member state are a matter for regulation or administrative action".
Paragraphs 6 and 7 follow very similar lines and in each case insist on the co-operation of the European Parliament.
I pass no comment on these amended articles to the Treaty of Rome, and I have reproduced them merely so that the Committee may be aware exactly how the position stands after these amendments. However, I want to emphasise one alteration which is immediately obvious. Whereas in the past there has been consultation with the European Parliament, the new rules under the Single European Act provide for co-operation. This is a very considerable difference.

277
The difference is dealt with when we come to later amendments, when the whole status and nomenclature used in respect of the European Parliament is discussed and some judgment is passed upon it.
The whole purpose of these articles is quite clear. My noble friend Lord Stoddart will deal with the provisions of Article 7, which lays down the procedure which will be applied by qualified majority, and the amendments to be sent back to the Commission, to the Parliament and up to the Council. These are reasonably clear in the article itself and made even clearer by the contribution of the Committee on European legislation of your Lordships' House.
However, there is a difference. It seems to me, in addition to the titular questions that are posed later in the Bill where we are invited to call the Assembly now, and retrospectively, the European Parliament, that we are taking a step towards recognising as a parliament a body which is not in any way analogous to our own. The name "parliament" in the British language, within our national history, has a special connotation. One does not need to describe the functions of your Lordships' House, but the other place is elected on universal suffrage. It is elected on a district basis. It is elected on a constituency basis which, when changes are made, are established by the Boundary Commission. Persons going to the other place do so with the full authority of those who elected them.
Governments and Ministers have to be chosen from their ranks. Membership of Parliament—in some cases membership of this place—is an essential ingredient for the formation of the government. Governments are chosen from that membership. If for some reason a Minister loses his seat, that is just too bad. Parliament therefore occupies a special place in the United Kingdom. That specifically applies to the other place, but Parliament as a whole is sovereign and in the final analysis Parliament can dismiss its governments.
The European Parliament is on a totally different basis and the use of the term "parliament"—with which later amendments will deal—combined with the new role given to it in this article suggests to us (or, should I say, to me) that this Act is just one further stage towards giving ever more power to the European Assembly; or as it now is, the Parliament.
I had the honour to represent your Lordships' House in the European Parliament during the years 1975 to 1979. That Parliament cannot be compared in any way with this Parliament—either the other place or here—because governments are not chosen from it. It is true enough, particularly after the efforts in the European Parliament of that very prominent Conservative, Sir Peter Kirk, who all of us respected and who did such great work in seeking to enhance its effectiveness, that some kind of Question Time was introduced into the European Assembly, as it then was although it called itself a parliament.
However, one cannot possibly compare Question Time in the European Parliament in Strasbourg with Question Time either in another place or in this House. With the exception, I am bound to say, of Commissioner Tugendhat who represented the United Kingdom when he was there and also the
278
Commissioner for Agriculture who so unfortunately died a few years ago, commissioners did not bother to answer, in the main, the serious questions that were put to them. One cannot therefore compare the Parliaments in any way. No Ministers sit there: only the Commissioners sit on one side and the permanent officials representing the council on the other. When the European Council Members are there they sit in front of them and can address the Assembly.
The European Parliament has none of the cut and thrust of argument as is customary in another place, and even, on occasion, in your Lordships' House. It tends to be more declamatory. To call it a parliament as a corporate entity such as characterises another place, and this place, is taking the word parliament into the realms of fantasy. The European Parliament is nothing of the kind.
I have participated in the European Parliament many times, almost submerged by the cascade of paper that descends on all European Members of Parliament—not a lot of which, I am afraid, is thoroughly read—and been somewhat bemused by it all. If one goes into the chamber—and I think it is the same now at Strasbourg as it was in Luxembourg and in Strasbourg in my time—the attendance is very sparse, except on very few occasions.
The sittings, too, are contrived. They are time limited. For example, the bureau is the management of the place and carries out the same functions as the learned clerks in this House—although I dare hardly mention it in the same breath because they are totally different—and arranges the business of the concern. It fixes the total time for the debates. The Socialist group is allowed, say, 35 minutes; the European democrats, 30 minutes; with perhaps 35 minutes to the Christian Democrats, and so on. There is no sense of occasion as there is in the other place or in this Chamber.
To elevate the European Parliament to the state of any meaningful plane where the mighty diapason of argument can be heard and exchanged across the Chamber, where people can even joke with one another, and to compare that with either this or another place is quite absurd.
I mention this because I do not think it is time to consider taking this other body, which is not a Parliament at all, within the build-up of the progressive organisation that has been so carefully constructed towards the ultimate achievement set out in the Stuttgart solemn declaration of European union and the federal state. I beg to move.
Lord Broxbourne: I rise to put a question to the noble Lord but if he has resumed his seat it may be that I am not in order in doing so. Has the noble Lord resumed his seat, or not? If he has not resumed his seat, I shall ask the question. If he has resumed his seat, then I will take advantage of the uncovenated benefit which seems to have fallen to me to address the Committee briefly on the amendment. It is for the noble Lord to say which of those alternatives he finds the less attractive.
Lord Bruce of Donington: So sensitive was I to the mood of the noble Lord that I instinctively gave way the moment that he rose. Therefore I have not

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technically resumed my seat. I am in eager anticipation of the question that he wants to put to me. I should not like to deny him that if I resume my seat now; so may I remain in a halfway position?
Lord Broxbourne: In the case of the noble Lord, that is probably a welcome posture, and an improvement on the more extreme positions which this House is accustomed to hear and admire from him. The question after those preliminaries was: In his lengthy and interesting excursions into the workings of the European Parliament, of which he and I were Members at the same time, does he not think some reference ought to have been made to all the valuable work done in the committees of that Parliament, which is perhaps the main contribution that it made, rather than in the more formal debates in plenary session?
6 p.m.
Lord Bruce of Donington: I welcome that opportunity. I did not want to lengthen my remarks too long by going on to the activities of the Committee. I do willingly concede that a tremendous amount of good work, as work, was done in those committees. In order that I might try partially to disarm some of my colleagues on theAlliance Benches, who seem to think I am hell bent on killing the EC, may I say that during the time when I served on the budget committee, Sir Michael Shaw, a member of this Party in another place, and myself produced the first joint pamphlet on the workings of the financial regulations and the budget committee generally. I am not quite sure whether it is, but I am told that it is still a standing booklet for the preliminary understanding of that matter. I mention the point purely to try to disarm those, in various sections of the Committee who apparently seem to think that during this debate I am trying to argue against the EC. All I am doing is trying to elucidate on it and passing the information, very respectfully, to your Lordships so that you can decide, after hearing the Government's explanation of these matters, whether, in the light of the amendments to the treaty, you wish these particular articles to stand. I am most grateful to the noble Lord for having given me the opportunity.
Lord Campbell of Alloway: The point is not whether the noble Lord, Lord Bruce, is intending to break up the European Community, the point is that, if your Lordships carry this amendment, you assuredly would. That is the point. There is no flinching. This amendment deals with institutional provisions under Articles 6 and 7 which are of fundamental consequence. They are the means of implementation of the Bill, and indeed of the SEA, to establish this internal market without trade barriers, tariff barriers, customs delays at ports and frontiers and all the other impediments to the movement of goods and services, establishment, capital and so forth in the Economic Community, which is the main area after all, and, let us face it, to establish our economic growth in the future. The means involved are really changing no more than six articles of the treaty, where there was unanimity required to qualify for majority voting, and
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introducing, I think, another five into that system of voting. As a result, instead of having 40, which we have today, we would have about 50 or 51 with the Single European Act.
So much seems to be said about parliamentary sovereignty, and rightly so in a way, but in practical terms no Parliament in any of the member states of the European Community wholly retains sovereignty. A measure of the United Kingdom's sovereignty was surrendered in 1972 when we adopted, in theAct of 1972, the fundamental concept of supra-national effect. All that this Bill proposes to do in this context is to amend Section 1 of that Act of 1972, to bring the SEA within Section 2 of that Act of 1972 and to confirm supra-national effect.
But why was this necessary? It was necessary because it was agreed by the Ministers of the member states at the Hague this year that all governments would surrender a small, further measure of sovereignty, a further devolution of power, from their respective parliaments on matters governed by the three treaties, in order to complete this internal market by the end of 1992. Mark this. This very situation ought to have been achieved at the end of the 12 year transitional period in 1969, years before we acceded to the Common Market. That is a situation which cannot be achieved unless the decision-making process were to be unblocked, as proposed by the Single European Act. This was recognised clearly at Stuttgart in 1983. It was accepted without reservation in Milan in 1985, and it was agreed by the Ministers, including our Minister, at the Hague when this SEA was settled.
I conclude by asking: Is it not wholly apparent that, if the Common Market is to retain credibility as a viable institution, these institutional provisions, Articles 6 and 7, to unblock the decision-making process are not only requisite but, in that perspective, reasonable? For those reasons (I hope they are reasons) I invite the Committee to reject this amendment and, with the leave of the Committee, limit the observations to that and not deal with questions concerned with the European Parliament, which, as I understand it, are the subject matter of a later group commitment.
Lord Molloy: I hope the House will not take the advice of Lord Campbell of Alloway because it is very dangerous advice. His submissions and arguments on fact are irrefragable. They cannot be questioned because their accuracy is absolute, but are we going to say that the words of any treaty which the United Kingdom enters into will last for a million years, that nothing can be changed? We have no constitution in this nation of ours, but we have changed it on many occasions. I can remember, when I had the privilege to serve as a Member of the European Parliament (I sat in the other place along with my noble friend Lord Bruce) that many of us were amazed because the whole thing was new to us. When we saw commissioners coming in and talking to the Parliament, it was like a Permanent Secretary from the Foreign Office or the Home Office invading the House of Commons. That is how it appeared to us then and that is the situation now.
Let me concede immediately the point that this nation, via a referendum, voted decisively to enter the

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Common Market. There is no argument about that. I am contesting that it must never be an offence in any way to criticise how it is progressing, or that it must never be an offence for any political party or any government of this country to wish to make changes. I am afraid that that is the attitude which has dominated discussions for the past few years, and I hope that we remember it.
When I served in the European Parliament we had a trump card which I used with effect many times; namely, the argument, "Perhaps you will not listen to what we are saying here in this Parliament but I can go back to the Mother of Parliaments and make a case there, although you refuse to listen to it here". Not only I but several other Members from all the parties did that. That ace card was taken away the moment that we had direct elections. We all know what a farce they are.
I do not suppose that many of the people living in the five or six constituencies which send an MEP to Europe know precisely what the European Parliament is all about. Well, they will have to learn in time because we are approaching a very dangerous situation. Regrettably, I fear that some of us are acquiescing in this dangerous situation and think that it is some form of Lèse-majesté even to criticise the European Parliament and the commissioners who serve it. They serve it well, but they in turn must remember that they are commissioners and they represent no one. We have to take full cognisance of that.
We are moving forward in the European Community, as we must, and I believe that the time has come for us to look very carefully at some of our measures and try to change them. We must look carefully at what is proposed and we must always have the right to endeavour to change it, not only in this Chamber but, I hope, in this British Parliament. Therefore I hope that when our representatives go back to the European Parliament they will take full cognisance of the submissions that have been made in this Chamber, and indeed in the other place down the corridor.
If we sacrifice that right and if we refuse every time to criticise some aspect of the European Community, then we are making a contribution to demoralising and perhaps sabotaging the spirit of democracy that is shared by both this Chamber and the House of Commons down the corridor. I hope that we understand that very clearly and sincerely. It does not mean that we are out to destroy, but that there are some of us who want to improve and, if I may say so in conclusion, to safeguard our democracy, so that it will in no way be threatened by the assumed democracy of any European Parliament.
6.15 p.m.
Lord Denning: I shall not take a moment: I want to say only a few words. This Chamber ought to be grateful to my noble friend Lord Bruce for tabling this amendment, because the two articles, Nos. 6 and 7, are really the crux of the new legislative proposals in the European Parliament.
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This is the very matter about which the Select Committee said:
"The powers of the United Kingdom Parliament will be weakened by the Single European Act. The Committee draw this important fact to the special attention of the House".
That is the matter that is now being brought up, because these two provisions, Articles 6 and 7, bring in a new procedure. I think most people will realise that reform is essential. There has been far too much obstruction and delay because one person against the rest could say, no. There may be obstruction by other nations or by us, but that is something which must be remedied if the Community and its Parliament are to survive. I have no doubt whatever of the importance of that fact.
In addition to the one sentence that I have already read out, the Select Committee also said:
"But the main impact of the Act will lie in its effect on the voting strength of individual Ministers. Since the United Kingdom Parliament exercises no control over Community legislation other than through the voice and vote of United Kingdom Ministers in the Council of Ministers, any weakening of the power of United Kingdom Ministers is felt equally by the United Kingdom Parliament".
Perhaps I may paraphrase that. If it concerns the Council of Ministers it means that the United Kingdom Minister can be outvoted by the qualified majority. Then, when the measure goes to the Parliament, the United Kingdom can he outvoted there. In a way, that will strengthen the powers of the European Parliament. On the other hand. the real question is whether there is any alternative if decisions are to be made by the whole Parliament.
If I may say so, it seems to me that those who drew up these very complicated provisions have done the best that can be done at the moment and therefore I am not against them, though I sympathise with the objections. What is important is that they should be drawn to the attention of this Chamber so that they can be considered and dealt with accordingly.
Lord Banks: I should like to oppose the amendment and support the general trend of the remarks of the noble Lord, Lord Campbell of Alloway. As the Committee is aware, Articles 6 and 7 deal with more majority voting in the Council in order to speed up decision-making and the completion of the internal market, and they concern a marginally increased role in consultation for the European Parliament.
When we entered the European Economic Community it was clear that within limited spheres we were going to embark on the pooling of sovereignty with our partners in the Council and some degree of limitation on the national sovereignty of all the partners was accepted. It seems to me that it is impossible through 12 national parliaments to control the Council meeting in secret. Each national parliament has some control over its own Ministers but it cannot control the Council. That is why, on these Benches, we have welcomed any increase in democratic control exercised through the European Parliament.
With more majority voting in the Council, it is true that the United Kingdom will be less able to block the proposals of others; but it is equally true that the United Kingdom will have more chance to secure

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support for its own proposals. Of course, it is clear that those who never wanted to be in the European Community in the first place regard as anathema increased majority voting and more power for the Parliament. It seems to me, as has been said more than once this afternoon, that they are trying to fight that battle again over this limited advance in the Single European Act. But I do not think that they are consistent about it. They object to more majority voting in the Council because if that happens the United Kingdom will lose the veto in that limited area; but they object also to unanimity being required in the Council to reject any European Parliament amendment which has been accepted by the Commission, because, they say, it would never obtain a majority and someone would always be exercising a veto. They cannot have it both ways.
Baroness Elles: I am not exactly certain which amendment we are discussing but I believe that it is an amendment to Articles 6 and 7; so we shall be dealing with the co-operation procedure at the same time. I am most grateful to noble Lords. I should also like to make a comment or two on the European Parliament.
As the Committee will know, for a long time now the European Parliament has been seeking new powers, as of course any democratic body does. I think it would be idle to pretend that that body is not seeking new powers. Nevertheless, I and colleagues in the European Parliament voted against the draft treaty on European union which had been produced by Mr. Spinelli and many other Members of the European Parliament, because I thought that it was asking for powers for which that Parliament was not ready; nor was it in fact capable of bringing to fruition the kind of measures on which it would have been voting and possibly taking a co-decision with the Council.
I must confess that I strongly support the way that the co-operation procedure has been worked out in the present Single European Act. Article 6 raises the co-operation procedures, as opposed to consultation with the Parliament, with regard to certain articles within the Treaty of Rome giving the Parliament slightly more say in matters dealing with the formation of the internal market.
The European Parliament, whether or not we like it and whether or not we despise it, as one or two Members of the Committee appear to do even though they were members of it, is nevertheless a place where people do a great deal of work with a great deal of determination, interest and dedication regardless of whether they are pro-European. I pay tribute to my Labour colleagues from the United Kingdom in that Parliament, because they all work. Time, trouble and expense are taken to produce amendments to draft proposals from the Commission. That is the duty of that Parliament, because it has a scrutinising role under the Treaty of Rome, which was adopted in this place in 1972. It is disgraceful when such amendments are totally ignored by the Council of Ministers, because the Council has already taken up a position through working groups, COREPER and so on, even before the European Parliament's amendments reach the Council.
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That is something that we all know happens. Mr. Rifkind, when he gave evidence to the Select Committee on European Communities admitted as much. I welcome the co-operation procedure, because before the Council takes up a final position it has to vote. It can reject the amendments made by the European Parliament. Those are matters which the noble Lord, Lord Bruce, kindly brought to the Committee's attention.
The co-operation procedure leaves a great deal of power to the Council. It has the ultimate power of decision. It can block amendments from the Parliament; it can reject them; it can decide to take no further action on them. The whole proposal will possibly then fall. That procedure has two advantages. First, the Parliament knows that whatever else happens the Council will be aware of its views before it takes a final decision; and so the European Parliament's view comes into the public domain. Secondly, where proposals have been made by the Commission and the consultation and co-operation procedure has taken place between the European Parliament and the Council, the draft directives cannot lie on the table for ever. That is an important point which people tend to forget.
Over and over again, the interests of individuals, companies, associations and professions are affected by the lack of decision on draft proposals from the Commission, where the European Parliament has given its decision but the Council, for one reason or another, possibly justified, has not taken any decision. Members of the Committee may be aware—I think the matter was raised on Second Reading—that the directive on architects was adopted after 16 or 17 years.
I believe that the noble Lord, Lord Bruce, wishes to intervene. He seems to be about to take off. He spoke about the European Parliament not being in any way like the House of Commons. I admit that. Perhaps he will recall that in 1978 I was sitting where he now is and he was sitting on this side. We passed the European Assemblies Act 1978 which was about electing European Parliament members. We had an argument as to the method of election, and we agreed on the method which is used for the House of Commons, although the constituencies are different. The constituencies are decided by the Boundary Commission and people have the right to appeal to it. In the European Parliament we represent individuals in this country who elect us to that Parliament. They expect their rights and views to be represented there and it is our duty to defend them.
Lord Bruce of Donington: I am most grateful to the noble Baroness for giving way. While she is on the point, does she recall that in connection with the procedure of direct elections I wrote a 4,000-word memorandum which was submitted to the Select Committee? Unfortunately it rejected my advice. Consequently, only in the United Kingdom, precisely as I predicted, are there members elected directly from constituencies. The rest of Europe, which had been busily impressing upon us the necessity to have direct elections, promptly continued to do exactly what it did before and send at least half of its members off a party list. That is not within the United Kingdom's conception of direct elections.

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Will the noble Baroness also reassure her noble friend Lord Beloff, who seemed to think that the moving of amendments was a mischievous procedure calculated to mislead the public, that her activities in the European Parliament involved the moving of a series of amendments which she has so justly praised?
Baroness Elles: I may take the opportunity after the debate is over. I am happy to have found at least one matter upon which I am in total agreement with the noble Lord, and that is as to the method of election of British members to the European Parliament. We benefit from our geographical representation, but I think that goes beyond the limits of this debate.
I should like to say a few words about the Parliament, as the noble Lord, Lord Bruce has raised the matter. Many parts of the world claim to have Parliaments. I understand that the IPU is now visiting the Parliament of Cuba. I suggest that the Parliament in Strasbourg is more democratic than the Parliament in Cuba or the Parliament of the Soviet Union. We had a visit from a member of the Soviet Embassy who said to me, "Lady Elles, we are much more democratic than you because 99 per cent. of the voters support the members in our Parliament".
We may perhaps agree to disagree on what is a parliament, but every democratic body has the right to call itself what it wishes. The other place chooses to call itself the House of Commons, just as this august Chamber chooses to call itself the House of Lords. The body in Brussels meeting in Strasbourg has the right to call itself a Parliament. It is no less democratic than many other Parliaments.
On the contrary, when the United Kingdom entered the Community it was to this Parliament that the European Parliament looked for guidance; it was to this country that the European Community looked for guidance to further the democratic process in the Community. The European Parliament has been called a parliament since 1962. We should surely therefore accept that and include it in English law.
I noticed that the noble Lord, Lord Bruce, sometimes referred in a Freudian slip to "the European Parliament". We are all called MEPs and I think the "P" has always been recognised as meaning "Parliament".
Lord Nugent of Guildford: I wish to make a brief point in answer to what the noble Lords, Lord Molloy and Lord Bruce, said about the possible amendment of this Bill. The amendment proposes that two articles be taken out of the treaty. The noble Lord, Lord Bruce, knows as well as I do what that would mean. If Parliament decided to do that or to take out any other articles we should have to return to the other 11 signatories of the European Treaty and renegotiate the whole thing.
6.30 p.m.
Lord Bruce of Donington: I am most grateful to the noble Lord for giving way. If he will read McNair's Law of Treaties, which is in the Library, he will find numerous occasions on which treaties, when they come up for ratification, are modified. States enter
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reservations on individual treaties in the process of ratification. All that happens is that the treaty goes back and is renegotiated. This is not unusual. In fact, if the noble Lord looks up Halsbury's Laws of England—I do not have a copy with me, but I am sure that the noble and learned Lord, Lord Edmund-Davies, will be able to inform the noble Lord of the appropriate section—he will find that treaties are not automatically ratified.
One does not have to agree to everything in them in the process of ratification. There was an argument, as the noble Lord knows, in the Dutch Parliament. If an amendment is made, there is nothing to stop the treaty going back to the original parties to see whether it can be renegotiated. There is nothing particularly wrong about that. Nor is there anything particularly urgent about the matter. It often takes two years to resolve reservations in respect of treaties. The noble Lord will find in McNair on treaties in the Library a number of examples of that happening in the past.
Lord Mottistone: The noble Lord has just proposed a further delay in a process—
Noble Lords: Order!
Lord Nugent of Guildford: I thank the noble Lord, Lord Bruce, for making that explanatory point. It does not comfort me in the least. I do not believe that it will comfort anyone else who wants to see progress in the development of the European Community. The noble Lord said that renegotiation might take two years. It might very well. It might take even longer. Two years have already been required, I believe, to negotiate what is before us. It has been extremely difficult to get agreement to refine measures that would make it possible to achieve the central market and so avoid the continuous obstruction of recent years. This is what the issue is about.
If, at this stage, we proceeded in this Parliament to take out articles, so invalidating the treaty as a whole and obliging renegotiation of it, it would be a major setback to the whole concept of setting up the central market in Europe. The noble Lord perhaps wishes that. The noble Lord, Lord Molloy, said that he did not want that. I am sorry that he is not in his place, but I am glad that he is able to hear what I am saying, for that is the effect of what he argues. There is very limited scope in this Bill and in this treaty for amendment unless we are prepared to upset the whole of the treaty. I would not be prepared to do that. Nor would the majority of the Chamber, I suspect.
There are marginal amendments that we might put at some stage to my noble friend. These relate to safeguards regarding the relationship between the Council and the advisory, management and regulatory committees. There seems to me to be some room for discussion and scope possibly for increased safeguards that we might usefully discuss. But the price of taking articles out of the Bill seems so enormous that I cannot believe that many noble Lords would be prepared to follow that course.
Lord Broxbourne: For the avoidance of doubt. on this occasion I rise not to put a question but to make a few observations to the Committee. I hope, however,

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to be mercifully brief. As the Committee knows, we are here concerned with Articles 6 and 7 of the Single European Act, which together revise and to some extent revolutionise the procedures of the Community. I have no qualms in regard to Article 6. The introduction of the qualified majority and the co-operation of the European Parliament are, I think, good ideas. It would be a mistake, clearly, to take Article 6 out of the Act.
Article 7 gives me rather more difficulty. It rewrites Article 149 of the Treaty of Rome and introduces what is called a co-operation procedure. That is an agreeably soothing phrase, on the face of it. However, one has to look more closely at what is involved. The effect of the so-called co-operation procedure under Article 7 is well and clearly set out in the first report to the House of Commons Select Committee. I ventured to give a short summary and some analysis of it in our Second Reading debate on 31st July. It is in fact a very complex procedure involving shuttling between the various institutions of the Community.
However, it is the essence of it that raises some constitutional doubts. At the end of the day, when all these procedures have been exhausted, the Council of Ministers may adopt a proposal of the Commission and requires only a qualified majority to do so. If, on the other hand, the Council of Ministers seeks to amend the Commission's proposal, it requires not just a qualified majority; it requires unanimity. Unanimity will be increasingly hard to achieve in a Community of 12.
This, the Committee may think, has some constitutional implications in that it involves a substantial redistribution of powers and functions in favour of the executive—that is to say, the Commission—as against the Council, which, for these purposes, represents the legislature. This redistribution reduces not only the power of the Council as such, but, in doing so, the power of individual Ministers comprising the Council and consequently reduces the ability of the national parliaments to which those Ministers are answerable to protect their countries' special interests and advance their point of view. This is a considerable change, with constitutional implications. For that reason, whether or not the amendment is appropriate as it stands, it is a subject that should command the attention of the Committee.
There are of course many good features in this Bill. No one would wish to disturb progress towards the internal market and the provision for political cooperation, although it might have been better had they been incorporated in a separate treaty in so far as they do not involve amendment of the Treaty of Rome. It was a little unkind of the noble Lord, Lord Gladwyn—I am sorry that he is not now giving us the benefit of his attendance—to describe the proposal before us as a wrecking amendment. The amendment is inspired, I believe, by good motives (at least, I hope it is) and not as a means of seeking repudiation of our membership of the European Economic Community. I would neither advocate nor support such a repudiation.
Although in 1972 I was not in favour of adherence to the Treaty of Rome for constitutional reasons, as I
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then sought to expound, and my wish was for an intimate but less institutionalised association with our European friends and partners—a wish that was not to be—I recognised and made clear in debates in those days that if adherence was formally given to the Treaty of Rome, then, in law and in good faith, we were committed. The Rubicon was crossed and there could be no going back on it. Our path then was to make the functioning of the Community as good as we possibly could.
I am certainly not unsympathetic to the institutions of the Community. As mentioned earlier, I was at one time a member of the European Parliament and—improbable as perhaps it may seem to noble Lords—I was for four years President de la Commission juridique of that Parliament. I was the chairman of the legal committee. It was our task in that multinational body to scrutinise the directives and the regulations emerging from the Commission and to see that they were within the letter and spirit of the treaty of the Community. Our task now in this Chamber is to scrutinise the instruments that derive from such as we have here today in the Single European Act with the same conscientious zeal that we of the commission juridique sought to apply in those days and no doubt still do.
We have heard much of the question of sovereignty. With great respect, this does not apply in that sense today. We no longer have sovereignty in the Dicey sense of the word. When I say "Dicey", I mean with a capital D, the great professor: I intend no pejorative epithet. We parted with that in 1972 for better or worse. Article 189 of the Treaty of Rome gives direct effect in the member states to the regulations and directions of the Community. Therefore national sovereignty in the absolute sense of the word is an institution which is no longer with us.
Looking at the amendments as they stand I have some doubts as to the wisdom of Article 7 for the reasons I have given: because of the redistribution of power in favour of the executive. We have many eminent constitutionalists on the Cross-Benches: the noble and learned Lord, Lord Edmund-Davies, the noble and learned Lord, Lord Denning, and the noble and learned Lord, Lord Ackner. They may share the view that the redistribution of functions should not be so much in favour of the executive as it would appear to be by Article 7 of the Single European Act. Although no doubt they will say they cannot accept an amendment which would delete Article 7, I would ask Ministers this question. Can they see whether anything can be done by goodwill and agreement among our Community partners to make the workings of this co-operation procedure more democratic and constitutional and less weighted in favour of the Commission than would now appear to be the case?
Lord Harris of Greenwich: Perhaps I may speak briefly on this question. I do not intend to follow the noble Lord, Lord Broxbourne, on the important question of whether this is or is not a wrecking amendment. We have had that debate on previous occasions. All I would do is follow the logic of the noble Lord, Lord Nugent, when he invited the noble Lord, Lord Bruce of Donington, to answer the question as to what he believed would be the effect if

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this amendment were to be carried. As I understand it there is common ground on this matter: we would have to go back and renegotiate the whole treaty all over again. I do not know what a wrecking amendment is if it is not capable of being answered in precisely those terms.
I think that the position of the noble Lord, Lord Bruce of Donington, is an entirely honourable one. It is an issue on which noble Lords on these Benches and a number of his colleagues do not agree. The issue is whether or not we should be members of the European Community. The noble Lord, Lord Bruce, and a number of his colleagues, are totally opposed to British membership of the European Community. I have heard nothing from them either during this debate or during the last few years to suggest that there has been a dramatic change in their position.
That being so, it is entirely logical for the noble Lord to move these amendments and the other amendments that stand in his name on the Marshalled List. However, for the same reason, I think he will understand that those of us who are firm, committed supporters of the European Community and British membership of it are determined to vote against those amendments because we believe that the effect of carrying amendments such as this and forcing a total renegotiation of this treaty would be deeply damaging both to the interests of this country and to the whole of the European Community.
For those reasons, briefly stated as they are, I very much hope that the Committee will reject these amendments.
6.45 p.m.
Lord Silkin of Dulwich: The speeches of noble Lords have raised a very important point. I had not intended to speak in these debates at all. But the point is so important that I think it desirable to do so.
We have to ask ourselves this question. Are we performing any useful function in putting down amendments and speaking to them, whether one agrees with those amendments or not? If we are told that to do so is simply wrecking, that if an amendment is carried then that destroys the Single European Act (or whatever other treaty may be involved) and therefore one ought not to put down or discuss amendments, then one is saying that one should not examine the whole basis upon which the legislation is being put before us. That, in my view, cannot be right. If it were right it would remove from Parliament an essential function: the function not merely of scrutinising legislation but also of scrutinising treaties made by Her Majesty's Government in the name of Parliament.
We therefore have this difficulty. We do not want to be accused of putting forward wrecking provisions. At the same time, if there are matters legitimately to be discussed, we want to be able to discuss them. I do not know when and where we can do so other than in this Committee, before Parliament, in the way that we are doing as a result of amendments being moved. I say that entirely without prejudice to my own view about the amendments of my noble friend, because I think
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he is absolutely right to move them whether I agree with them or not.
At the end of the day surely we have this situation. We have to weigh up the pros and cons of the various provisions in the Single European Act to which our attention is drawn. We may like some; we may like others less. We then have to do a balancing act, and ask ourselves, even with those parts of the Single European Act which we consider to he less advantageous, which we like less than others, whether we are prepared none the less to accept the Act as a whole because we think on balance that it helps rather than hinders; or, are some of those provisions that we like less so important and fundamental to us that we are bound to say to the Government, "We want you to go back and re-negotiate them"? That seems to me to be the dilemma. I do not see how that dilemma can be resolved unless we have the opportunity of discussing each one of them individually and coming to a conclusion about them.
Therefore, when the noble Lord, Lord Nugent, who is not at the moment in his place, suggests as I understood him to suggest, that really we ought to be accepting the Single European Act as a whole, or rejecting it as a whole, I think he is ignoring the essential point: that for us to do that we would have to look at each individual part of that whole and decide on balance what we think about the whole in the light of the sum of the parts.
I hope that we shall be able to discuss these amendments without taking the view that to do so is either committing ourselves to a wholesale anti-European view or a wholesale pro-European view. As it happens, the noble Lord, Lord Broxbourne. is well aware that my attitude towards the Community has been as well known as his has. In the past our views have been on opposite sides of the fence. I am delighted that our paths have now converged to the point at which we both recognise that the Community exists and that the best course we can follow now is to make the best of the situation.
I believe that, in looking at these amendments to see whether, on balance, they do irreparable harm to the interests of this country or are so disadvantageous that we ought to reject part of the Single European Act, we are really saying to the Government that we accept the balance that they have reached, or we do not accept the balance that they have reached, and they must go back and renegotiate on our behalf.
Lord Mottistone: I just want to take up the point that the noble and learned Lord, Lord Silk in, has made. Of course, when one is discussing any Bill one must have the right to put down amendments which one thinks are right. There is one factor that needs to be considered against the background of all this. Because it relates to a treaty and therefore puts a much greater delay in the enactment of the vital factors by two years or so, instead of just a week or so, one must remember that the real reason behind all this is to improve the opportuntities for trade. It has been quite intolerable that directives on quite simple matters have taken six or seven years to get through. Trade has suffered deeply both inside the Community and worldwide. On top of that, there are quite a lot of harmonisation directives which could have improved

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trading positions but which have had to be dropped altogether. So when one considers whether to risk referring this back, in effect, to the diplomats for a two-year delay in renegotiating a treaty which has already been negotiated, one must remember that in the process one is destroying trade which has already suffered for far too long.
Baroness Hooper: I was somewhat surprised at the breadth and scope of the remarks of the noble Lord, Lord Bruce of Donington, in introducing this amendment. We had in fact sought to group certain amendments relating to the European Parliament in advance through the usual channels, but unfortunately did not receive any co-operation. Therefore, I understand we were addressing ourselves only to Amendment No. 2 whereas we now seem to be on to majority voting in the Council which arises under Amendment No. 5, and the change of name of the Parliament which again arises under Amendments Nos. 44 to 51. Of course, I am happy to speak at this stage in part to those amendments also.
In view of the wide ranging nature of the debate, and since the main object of Articles 6 and 7 is to lay down co-operation procedures—indeed, in view of the fact there seems to be some misunderstanding on this point—it may be helpful and useful to explain again what is involved in the new co-operation procedures with the European Parliament.
The present position is that the European Parliament already has the right to be consulted under some 17 articles of the EC Treaty. The Single European Act lays down a new procedure for 10 articles, some of which are new—that is, introduced by the Single European Act itself.
Perhaps I may interject something from my experience as a directly-elected member of the European Parliament. I hasten to say I do not regard these elections as a farce, which was the suggestion of one Member of the Committee opposite. This experience may be shared by other noble Lords who have served in that Parliament. In fulfilling its institutional role, the European Parliament is expected to consider, and if necessary amend, proposals made by the European Commission. This has to be done before the Council of Ministers can make a final executive decision. Time and again as members of the European Parliament we laboured hard and long to alter the proposals to fit the expectations and aspirations of our constituents and the countries we represented, only to find that the Council was working on a document which bore so little resemblance to the document on which the Parliament's opinion was based that we had in effect wasted our time.
The co-operation procedure is designed to enable the Parliament to make its views known and to give the Council the opportunity to take account of them, before the respective positions of the institutions are set in concrete. I have said that there are 10 articles to which the new procedure will apply. They mainly cover measures affecting the internal market. When these measures are proposed by the Commission, the proposal will go to the Council and the Council will discuss it and adopt a common position. This common position will be sent to the European
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Parliament which has to muster an absolute majority of all its members to pass amendments of which both the commission and the council will have to take account.
The next step in the procedure is for the Commission to consider changing its proposal to accommodate the parliament's amendments. It is not obliged to do this but if it did so the Council could still, as it can now, change the Commission's revised proposal by unanimity. Where the Council accepts the revised proposal then, as now, it will vote according to the relevant treaty article.
The European Parliament may reject altogether the common position of the Council, but it may only do this by an absolute majority of all its members. The Council can still go ahead and adopt its common position by unanimity. Unanimity is at present required for many of the Council Acts covered by the new procedure—for example those under Article 100. I hope this clarifies the position in this respect.
Some Members of the Committee have expressed the fear that, for example, there could be an alliance between the European Parliament and the Commission to change the Council's common position. The fear has also been expressed that the European Parliament will put pressure on the Council by rejecting the Council's common position. Behind both these fears is the anxiety that it will then be difficult for the Council to achieve the unanimity required to push a proposal through, particularly if there is an alliance between one member state and the European Parliament. But, were this to happen, we should be no worse off than we are now with the current requirement for unanimity which some noble Lords are anxious to retain.
In practice, I do not think that these fears are well-founded in any event; First, because the requirement on the Parliament is to muster an absolute majority of all its members to reject or amend a Council common position. This means finding 260 votes out of 518 which I know from my own experience to be a fairly rare occurrence. Very few proposals before the European Parliament in practice command an absolute majority in favour.
Secondly, we are talking about Commission proposals on which the Parliament will already have given its opinion. These proposals may have been amended, as often happens now, by the Commission to reflect the Parliament's views before the Council considers them. Unless the Council changes the Commission proposal out of all recognition, the Parliament will be re-examining a proposal which may already reflect its views. It is much more likely that the Parliament will propose amendments than that it will reject common positions altogether. As I have explained, where it does propose amendments, the position remains as it is now.
It is vital to remember that the Commission is not obliged to accept the Parliament's amendments. Indeed, if the Commission and the Council have laboured hard to find a measure which can command majority support among the member states, the Commission will not lightly accept amendments which would destroy the majority in the Council, for this would mean that the Commission proposal

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concerned would lapse through lack of support. Such amendments cannot go through in the absence of a Council vote. They go through only if there is a qualified majority in the Council in favour of them. If there is no qualified majority, then the proposal will lapse after three months. Therefore, there are built-in safeguards and we are faced with an attempt to improve co-operation and to give the directly elected Parliament, in which this country is well represented, its rightful voice among the European Community institutions.
Perhaps it may help the Committee if at this point I also try to sort out some of the misunderstandings that have arisen over the question of majority voting and the use of the word "veto". These were evident in the earlier discussion as well as in the discussions on this amendment.
Under the existing European Community treaty, some 32 articles make provision for decisions by unanimity and some 49 articles for decisions by qualified or simple majority. Under the Single European Act the number of articles under which decisions can be taken by qualified majority will rise by 10, principally in the internal market area where we wish to see progress, which is a sentiment which has been reiterated by a number of the Members of the Committee in the course of the discussion.
The requirement for unanimity in the treaty obviously constitutes a veto in the sense that any one member state can block progress even though all the others wish to go ahead, unless all agree that, under the terms of the treaty, a measure cannot be adopted. As a result of the Single European Act that block on progress will be removed from outside. However, the Luxembourg Compromise—frequently referred to as a veto—will remain available. The Luxembourg Compromise applies only to those articles where qualified majority voting is the rule. Where a very important national interest is at stake and where a member state might otherwise be voted down, it enables that member state to ask that discussion should be continued until agreement is reached.
Some noble Lords may ask: what is the point of moving from unanimity if the Luxembourg Compromise is still available? The answer is that, where unanimity is the rule, it is all too easy for a single member state to block progress. All it needs to do is to say that it disapproves or disagrees and a member is thereby blocked. Where majority voting is the rule any member state wishing to prevent agreement will have to invoke the Luxembourg Compromise; that is, it will have to make a clear request, based on a sober assessment of national interest, that a vote should be deferred. That alone would be an inhibition on member states from invoking the Luxembourg Compromise unnecessarily and unless a very important national interest really is at stake.
Lord Bruce of Donington: If the noble Baroness will give way, perhaps I may help her. If she is about to deal with the Luxembourg Compromise, perhaps I may point out that I am most anxious that that should not be dealt with in detail now as, of course, under Amendment No. 37 it will arise in its most concrete form. I thought that perhaps the noble Baroness might bear that in mind if she contemplates continuing
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further on the matter of the veto and the Luxembourg Compromise. We shall have a later opportunity to deal with it.
Baroness Hooper: Yes, indeed. As I said at the outset, a number of issues were touched upon which we had not anticipated and therefore I was going to take the opportunity to deal in part with references to those other points. Perhaps I may also refer to the remarks made by my noble friend Lord Broxbourne about the unanimity requirement under the revised Article 149. My noble friend pointed out that, where the Commission makes a proposal, that proposal can only be amended by the Council by unanimity. In this respect Article 149 is entirely unchanged from the existing treaty. Article 149 of the existing treaty states that:
"Where the Council acts on a proposal from the Commission unanimity shall be required for an act constituting an amendment to that proposal".
Therefore, the new arrangements exactly follow the old.
Turning very briefly to the change of title as again this will arise under subsequent amendments, I find it extraordinary that so long after our joining the European Community we are still arguing whether the institution should be called an assembly or a parliament. This is, after all, a semantic argument in which the country as a whole has very little interest. The institution has been universally known as the European Parliament since 1962. It is referred to as such by all political parties in their manifestos both for the European elections and for general elections. Indeed, as my noble friend Lady Elles also noted, the noble Lord, Lord Bruce of Donington, himself claimed that he had the honour to represent his country in the European Parliament from 1975 to 1979.
In conclusion, in relation to the various points that have been raised, the noble Lord, Lord Bruce, suggested that it was not unusual to renegotiate treaties between signature and ratification. It is certainly possible, but I would not accept that it is usual, particularly in the case of multilateral treaties negotiated at Head of State level, such as the Single European Act which is before us. The noble Lord seemed to suggest that the problem could be solved by the making of reservations. A reservation appended to ratification which stated that the United Kingdom would not regard itself as bound by Articles 6 and 7 would be contrary to the object and purpose of the treaty and would be certain to give rise to objection by the other signatories. A reservation in such terms would in fact prevent the entry into force of the Single European Act between the other member states and the United Kingdom.
We have looked hard at these amendments and there has been a very full discussion. I beg the Committee to support the provisions of the Single European Act and to reject the amendment.
On Question, amendment negatived.
Baroness Young: In view of the hour, I wonder whether this might be a convenient moment for us to break for dinner. Therefore, I beg to move that the

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House do now resume. I think that we can return to our debates at 8.10 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Local Authorities Cemeteries (Amendment) Order 1986
7.8 p.m.
Baroness Hooperrose to move, That the order laid before the House on 2nd July be approved. [29th Report from the Joint Committee.]
The noble Baroness said: My Lords, I beg to move that the Local Authorities Cemeteries (Amendment) Order 1986, laid before the House on 2nd July, be approved. This is a minor order with a simple purpose. It will provide that burial authorities may, if they choose, keep burial records on a computer.
It is now over nine years since the House debated and approved an order providing a comprehensive management code for local authority cemeteries. With the passage of time, Article 11 of that order—the Local Authority Cemeteries Order 1977—has become unduly restrictive. It requires that particulars of local authority burials must be recorded by hand. They must be entered in ink in register books, and signed. New technologies have not therefore been applied in this area of record keeping.
The draft order now before the House amends Article 11. It will provide the option—and it is no more than that—for local authorities to computerise burial records. Certified documents produced by a computer retaining such records will be deemed to be copies of an entry in the burial register.
The proposal for an amending order was put to the Government by the burial authorities themselves. The authorities felt that, in appropriate circumstances, the changeover from manual to computerised registration would lead to savings in staff time and storage space. This would particularly be the case for the larger authorities with higher numbers of burials and computer facilities already available. In addition, improvements could be made to the service for users. This could be achieved without detriment to the extent or legibility of the details recorded. Most importantly, however, the authorities felt the proposed change would not in any way undermine their special duty of care towards relatives of the deceased. Before reaching a final view on the proposed change the Government consulted some 22 organisations, including the local authority associations, funerary interests, church bodies and relevant trade unions. No major objections were raised.
In summary, this order deals solely with cemeteries provided by local authorities. It provides a discretion for authorities to take advantage of modern techniques of record keeping. It does, however, leave the discretion whether to adopt new methods where it properly belongs—at the local level. I commend the order to the House.
Moved, that the order laid before the House on 2nd July be approved. [29th Report from the Joint Committee]—(Baroness Hooper.)
Baroness Nicol: My Lords, we are grateful to the noble Baroness for her explanation of the order and we welcome it. However, there is just one small question which I should like to ask and also one small reservation; that is, that the value of permanent records of burial over the years is undoubted. People require them for all kinds of reasons. We would like to be reassured that where an authority decides to go over to computerised records there will still be a permanent record available.
My understanding is that computer tapes degrade after a particular length of time—10 years perhaps, or 12. It seems to me that it would be a pity, if not an inconvenience, if permanent records were not kept. Is there therefore any intention on the part of the Government to see that where a computer system is entirely taken up there shall be some permanent record still made? A computer print-out would suffice. but the order as it stands does not require that this shall be done.
With that single reservation we welcome the order and I hope the noble Baroness can give a satisfactory answer.
Baroness Hooper: Yes, my Lords, it is intended that the public should have acccess to these records. Most authorities already permit searches and perhaps make minor charges in this respect. The availability of printouts therefore, which it would be possible for the relatives of the deceased to keep, would be met in the circumstances. I think that the noble Baroness can be reassured that access to the records will be available and that the ability to take a record from those computerised records will also be a possibility.
Baroness Nicol: My Lords, by leave of the House, I welcome the explanation but it does not quite meet my point. I wonder whether permanent records will be made as a matter of course, because it is not simply the point of the immediate relatives at that time requiring a permanent record, but at some time in the future researchers or distant relatives, perhaps from abroad, may need to have access to the records. Will they exist in a permanent form? Computer records are not necessarily permanent unless they are printed out as a matter of course.
Lord Winstanley: My Lords, to add to the point made by the noble Baroness, what one is concerned about is the durability of the records to which she has referred. I, for purely personal purposes, have been inquiring recently into burial records dating back to 1602. Were we to have to wait for hundreds of years and then be told that we could have a computer printout, I venture to suggest it might not be satisfactory if and when we got it.
Baroness Hooper: My Lords, I am not sure that I have the exact response, but, were this a question of security of records, the copying of magnetic tapes or discs is normally standard procedure for computer installations so that the records may be created, for example, in the event of accident or destruction by fire, as well as because of deterioration. Nevertheless, precautions will be taken, such as copies being kept in fireproof safes or at other sites. As I have said, it is

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probable that authorities will keep copies of the register in print-out form, and Article 12 of the 1977 order directs that records shall be stored so as to preserve them from loss or damage, which must include deterioration. However, I have taken the points made by the noble Baroness and by the noble Lord, and obviously these will be borne in mind in putting the order into practice.
On Question. Motion agreed to.
Baroness Hooper: My Lords, I beg to move that the House do adjourn during pleasure until 8.10 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.16 to 8.10 p.m.]

European Communities (Amendment) Bill
House again in Committee on Clause 1.
Lord Stoddart of Swindonmoved Amendment No. 3:
Page 3, line 13, after ("Communities)"), insert ("but not Article 8 thereof").
The noble Lord said: I beg to move Amendment No. 3, which stands in my name and in those of my noble friends. It may be for the convenience of the Committee if we also discuss Amendment No. 4. I sat quietly, as I usually do, listening to the debates on the previous two amendments. I was to some degree amazed and indeed rather concerned at the ease—indeed, the alacrity—with which the Committee was prepared. in the face of advice not only from your Lordships' own Select Committee but from the Select Committee on Foreign Affairs of another place, to vote away some of our powers and some of our sovereignty. We heard from the noble Baroness, Lady Elles, that the European Assembly—shortly to be officially named "the Parliament"—wishes to get its hands on more power.
Indeed, it is my view that the European Assembly always has been, is at present and will continue in the future to be avid for power. There is only one way in which it can have more power and that is to filch it from somewhere else, and generally speaking it will filch it from your Lordships' House and the House of Commons. It will filch it from the British Parliament. As I say, I was surprised that we should agree to the first amendment with alacrity; that we should agree almost with acclaim to reduce some of our sovereign power. But there has always been this ratchet effect within the EC.
We know perfectly well that in 1972, during those long debates in which I took part in another place, we were given all sorts of assurances that the sovereignty of the British nation would not be affected in any way by our going into the EEC. We were assured that Parliament would lose none of its sovereignty. Yet we are now told by our own Parliament that we are to lose even more of our sovereignty than we lost when we entered the Community—although we were assured, and the electorate were assured, in the 1970s that we should not lose such sovereignty.
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The treaty which we are discussing today in conjunction with the Bill is yet another of those ratchets which takes away from this place and from another place power and gives that power to the institutions of the Treaty of Rome. During the discussion that we had on our previous amendments, the noble Baroness, Lady Young. in dealing, I think, with the contribution by her noble friend Lord Caldecote about the Prime Minister's remarks this morning, quoted her as saying that this Single European Act was essential for the progression and the well-being of the Community.
Now the Prime Minister has changed her mind. On 2nd July 1985, she said after the Milan Summit:
"Positive improvements in the Community's decision-making could have been decided in Milan and did not require any treaty amendment. I saw nothing before us that would require an amendment to the treaty".
That was the Prime Minister's view in July 1985. But apparently that view was changed by some means or another; she changed her mind. I feel quite sure that she changed her mind very reluctantly indeed. That is another reason why I was surprised, and continue to be surprised, that this House and the other place are prepared to accede to the ratification of this treaty with such alacrity.
Having made those points, let me now come to the amendments which are before us, Amendments Nos. 3 and 4, and consider what they mean. Let us have a look at Article 8 of the Single European Act. It says:
"Any European State may apply to become a member of the Community. It shall address its application to the Council, which shall act unanimously after consulting the Commission and after receiving the assent of the European Parliament which shall act by an absolute majority of its component members".
That is an entirely new power which is being given to the European Parliament. It is not an increase in its present power, if I am reading the Treaty of Rome aright; it is a new power. Article 237 states:
"Any European State may apply to become a member of the Community. It shall address its application to the Council whose decision, after the opinion of the Commission has been obtained, shall be unanimous".
There is no mention there of the European Assembly. It goes on to say:
"The conditions of admission and the adjustments to this Treaty necessitated thereby shall be the subject of an agreement between the Member States and the applicant State. This agreement shall be submitted for ratification by all the contracting States in accordance with their respective constitutional rules."
In other words, under those circumstances the application of a new member would have to be referred to this Parliament, and presumably the parliaments of all other member states, for ratification. There is no mention there of the European Assembly. So in fact we now have the European Assembly, shortly to be officially called a parliament, having to give its assent, where assent was not before required, before a new member can be admitted.
Your Lordships may say, "So what? That is merely another voice to be heard and another assent to be given". They may argue that after all it is a democratically elected assembly and why should it not give its consent? But I would remind your Lordships that all the parliaments, including this one, of the European Community are elected by democratic means and they are usually elected on the basis of perhaps a 70–80 per

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cent. poll, whereas the European Assembly, certainly in this country, is elected on something like a 30 per cent. poll.
Why in fact do we need the assent of this other assembly? The people have already given that power of decision, through election, to the national parliaments. But I suppose it would not matter so much if there was just another voice and that was all there was to it. In fact, here is a dangerous loss of sovereignty, because what the European Assembly, shortly to be called a parliament, can now do is to blackball the admission of any applicant to the European Community, so that they have a very real power for the first time. That is something entirely new, and although all the parliaments of all the 12 states may wish a new member to be added to their ranks, they may not do it. Some of us perhaps could not conceive that they would do it but, if they wish, they can overrule the democratically elected parliaments of all the 12 states. As I have said, that is a new power given to the European Assembly, and it is a power not taken away but a power which is certainly in some way acquired by the European Assembly over the national parliaments.
Something similar, although not quite the same, applies to Amendment No. 4, which refers to Article 9. That says that the second paragraph of Article 238 of the European Communities Treaty shall be replaced by the following provision:
"These agreements shall be concluded by the Council acting unanimously and after receiving the assent of the European Parliament, which shall act by an absolute majority of its component members."
Article 238 refers to associate membership of the European Community and Article 238 refers only to consulting the assembly. In fact, for any country to be able to get associate membership, they will have to get the assent of the European Assembly. Indeed, there is no role here for our own Parliament or any other parliament of the 12 European states. There is no role for us at all. We do not have to ratify it; we are not consulted; and we do not have to give our consent or assent. But in future the assent of the European Assembly will be necessary not only for new members but also for associate members.
I submit to your Lordships that this is a very real derogation of our own sovereignty and an addition to the powers and sovereignty of the European Assembly, soon to be called a parliament. Those are the facts. It is no good trying to convince us, as happened in another place, (though not in this House), when attempts were being made to convince Members that words actually did not mean what they said. I prefer to believe that words do mean what they say, and when words mean what they say we should take them very seriously. We should not say, "Perhaps they mean that, or they might mean this". So far as I am concerned, they mean what they say and they mean that a certain amount of sovereignty has gone from this place, and additional power has been given to the European Parliament.
I hope I shall not be told that if we, as a Chamber, had the temerity to agree to these amendments we would in fact be wrecking the whole treaty, because
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that simply is not good enough. We have before us a Bill—and I think my noble and learned friend Lord Silkin of Dulwich explained this—and any Bill which is before us must be capable of amendment by this Chamber, as it is by another place, after full discussion. When we are told that if we in our wisdom decide that something is too dangerous and will derogate from the sovereignty of this Chamber, and that if we decide in those circumstances to pass an amendment which in fact alters the treaty arrangements we will be doing great damage, that we should not do it and that basically and morally we have no right to do it, that is not the way to run any assembly, whether it be this Parliament or the European Assembly. We must be allowed to make our decisions in accordance with our constitution and not under threat.
I sincerely hope that your Lordships will take those points seriously because I have a high regard for, and love of, our Parliament and our constitution. I want to see nothing happen which will take away the powers that we have and the manner in which we do our business. I believe that we have an example to set to the rest of the world and that we still have a role in the world as an independent state. I beg to move.
Lord Reay: Apart from the perceived need to improve the decision-making machinery of the Community, the other strand in this Bill and throughout the negotiations which led up to the agreement on the Single European Act was the desire to give more power or influence to the European Parliament. This desire was felt very much more strongly by some of our partners in the Community than by ourselves: indeed, it was felt very much more strongly by some of them than is finally reflected in this Bill. But because of that—although not only because of that—something had to be done in this area to give more influence to the European Parliament because, as I say, of these very strong wishes of some of our partners in the Community and also for reasons of natural and historic logic.
What was the point of our ever introducing direct elections to the European Parliament, with all the effort, the dedication and expense which my noble friend Lady Elles was listing earlier this afternoon, if we were not at some stage to give the European Parliament a more general legislative function than it has today? I think that the powers that have been given to the European Parliament under this Bill are very intelligently calculated. It is not clear exactly how they will work out, but I think that they have been finely balanced between the interests of national parliaments and the need of the member states to move forward in progress with the European Community.
I think that the two particular powers on which the noble Lord, Lord Stoddart, was commenting so negatively in these amendments, and also the new powers of the European Parliament to give assent to new accessions and association agreements, are perfectly proper powers to be given to the European Parliament. They do not, as I see it, derogate—at least directly—from any sovereignty of national parliaments and I believe that these two amendments should be rejected on their merits.
8.30 p.m.
Lord O'Hagan: I should like to support the noble Lord. Lord Stoddart, in one comment which he has made. Of course this House, while the country does not have a written constitution or an elected Upper Chamber, is the place which should discuss all matters which affect its constitution. I think we owe a debt to the noble Lord, Lord Bruce, and to his colleagues for putting down these amendments, which provide us with an opportunity to discuss what is, by any standards, an important constitutional step for the country and the Community. I would certainly not add my voice to those which are alleged to have been raised in calling for these amendments to be struck from the record. They provide an opportunity for us to see at first hand the shallow and shabby nature of the case which the noble Lord, Lord Stoddart, has just advanced.
The noble Lord has alleged that national parliaments would no longer have any powers if new states wished to become members or associates of the Community. The Council of Ministers would of course retain those powers which it has under the present treaty and, if the provisions are to be operated by unanimity, member states would be responsive to their national parliaments. Unless the noble Lord believes that in the future member states' representatives in the Council of Ministers will not be accountable to their national parliaments, of course national parliaments will continue to maintain very stringent control over their representatives—
Lord Bruce of Donington: I am grateful to the noble Lord for giving way. Will the noble Lord concede the point that many Ministers, allegedly representing their own parliaments, face their own parliaments with decisions that have already been made and do not seek in advance a mandate for the actions which they take? Does the noble Lord still say that the position of parliaments—and I am talking particularly about the United Kingdom—is fully safeguarded by the fact that we have a Minister? Ministers, as in the case of this particular Bill, did not notify Parliament in advance.
Lord O'Hagan: I shall not be tempted down all the highways and byways to which that intervention might lead me. I shall say to the noble Lord only that my experience of British Ministers representing governments of the party of which I am a member is that they consult very fully with their colleagues, and Members on their side of the House, before going into negotiations in the Council of Ministers, for the simple reason that they need to maintain a majority to defend the decisions they take in council when they return to the House. Perhaps under the administration of the noble Lord's party things did not proceed in that manner. However, in the Danish Volkting, for example, there was a Market Committee which governed the actions of Ministers of whatever party. All the Ministers of the present Government, as I understand it, are fully responsive to what their colleagues in the House of Commons and the Government ask them to do, in advance of their representations of the Government in the Council of Ministers.
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I really intervened to make a speech that touches on comments which might have been advanced more appropriately earlier, but as there were so many other speakers I thought I should wait until the Chamber was emptier. The purpose of the European Community is to serve those member states forming it. It is not an organisation designed to crush the individuality and the liberty of those citizens who form part of it. My constituents wish to see a European Community which is more responsive and which acts more quickly, rather than one acting more slowly and being more remote. These provisions in the Single European Act, taken together, form a parcel of modest measures which advance the cause of democratic control and make decision-making at the top easier to complete.
The noble Lord, Lord Stoddart, speaking in a revivalist mood about days gone by when he and his colleagues failed to convince the British people that the European Community was the ultimate destruction of the British parliamentary way of life, does not seem to have recognised that the European Community is moving slowly to new ways of making itself more accountable and accountable directly. Like him, I am sorry that the turn-out was not higher in the last European election and I hope he does his best to make sure that the next European Parliament can carry out these powers and make the Community work better and take decisions faster. We can then have a Community that is closer, rather than farther, from its people.
Baroness Hooper: I am sorry that the noble Lord, Lord Stoddart, after sitting so quietly and patiently through the earlier debate, feels it necessary to indulge in scaremongering to the extent of saying that if the European Parliament is going to increase its ability to operate within the European Community it will be filching power from somebody else.
I feel that it is also necessary to refer to his suggestion about a change of mind by the Prime Minister. In fact, when the Prime Minister reported to another place on the Milan European Council of June 1985, she referred to our reluctance to envisage the far-reaching treaty changes which some were then canvassing, but both she and my right honourable and learned friend the Foreign Secretary made clear that we would consider any proposals for treaty amendment on their merits and, in particular, whether they would lead to early completion of the common market in goods and services. Both my right honourable friend the Prime Minister and my right honourable and learned friend the Foreign Secretary played a leading role in securing the entirely practical changes to the European Community Treaty which are incorporated in the Single European Act. That is why the Prime Minister was able to commend the agreement to Parliament and the country.
Turning to the specific amendments, on Amendment No. 3, which relates to Article 8 of the Single European Act, the present position is that the opinion of the European Parliament is already sought before the accession of a new member state to the Community. Under the new procedure in the Single European Act, accessions will require the assent of the European Parliament. This has already been stated.

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The consent of this Parliament and of all other national parliaments in the Community will still be required before new member states can join the Community. There is thus no change in the role which national parliaments at present have in approving new accessions. To some extent I am surprised that the noble Lord, Lord Stoddart, is worried that the European Parliament should be able to say "no" to future members. In view of his party's views I would think they would be happy to curtail any increase in growth. Obviously, and equally, if the European Parliament says "yes" to a new member state, then a national parliament can also blackball that state's membership.
Turning now to Amendment No. 4, which relates to Article 9 of the Single European Act, the present position is that the European Parliament is consulted on association agreements. The Single European Act gives the European Parliament an opportunity to play a constructive role in relation to new association agreements. Again, the role of this Parliament and that of other national parliaments will not be diminished. They will have the last word as they do now and it must be said that the European Parliament, in view of its role in dealing with associated countries, is in a very good position to play an important role in this respect. It is most unlikely that the European Parliament would wish to hold up association agreements, for that would damage the very relations with the Community's associates which the European Parliament is keen to sustain. For those reasons, I hope either that noble Lords will be prepared to withdraw their amendments or that the Committee will reject them.
Lord Stoddart of Swindon: There are one or two points to which I should like to reply. First, the noble Lord, Lord Reay, referred to direct elections and his view is that if you directly elect an assembly then you should give them power. That is exactly the view which I expressed in 1967, 1968 and 1977 in another place when we discussed this matter. That is precisely what I predicted, and indeed what many other illustrious Members of that place predicted—that there would be additional powers demanded and given to a directly elected parliament.
That is why I voted against it. I resigned from the Government to vote against it because I did not believe what my own side were telling me, that direct elections did not mean any additional powers. If the noble Lord troubles to look at the reports of those debates, he will see that assurances were given—indeed, they were given by Michael Foot, who apologised for them during the debates on the Single European Act—that a directly elected parliament did not mean additional powers; and the House of Commons, and presumably this Chamber, took him at his word. But now, as we predicted, they are demanding and being given new powers.
As time goes on—and the Committee has the word of the noble Baroness, Lady Elles, on this—they will want more power. That is the nature of the beast. That is the nature of all assemblies and parliaments, except apparently this one. We want to give it away. But there is no doubt, as the noble Baroness, Lady Elles, has told
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us, that the European Parliament will demand more power. They can get that only from one place, which is the national parliaments of the member states.
Baroness Elles: Will the noble Lord allow me to intervene? Has he considered at all the problem of the democratic deficit, where certain powers were given to the Community 13 years ago and there was no democratic control at all of those powers? Would he consider that what the European Parliament are looking for at the moment is certainly not to take powers from national parliaments, but to exert the power with which they should be entrusted and which at the moment is not controlled by any democratic forum at all? It is an aspect of the argument on which the noble Lord has not touched.
Lord Stoddart of Swindon: I understand precisely what the noble Baroness is getting at. She believes that within the Community the European Assembly or Parliament—call it what you will—should have the power of democratic control. I understand that argument perfectly, but it is an argument which I have not accepted in the past and which I do not accept now. I believe that the proper democratic control of Community institutions should be through the national parliaments and I have always taken the view that Ministers should act in council only with the consent of the national parliaments.
There is a big difference between us. There is no doubt about that. The noble Baroness holds her own views, which I respect, but those are my views. However, I understand the point she is making and, indeed, I am praying her in aid of my own case that inevitably, if one assembly obtains more power which has previously been exercised by another assembly, that other assembly is bound to lose some of its power and therefore some of its sovereignty.
Lord O'Hagan: I can intervene only once on this point, and it is a central point. The noble Lord is not addressing himself to the intervention made by my noble friend Lady Elles. The noble Lord discounts the possibility that those aspects of democratic control, which were inevitably removed from the purview of national parliaments at the time of the formation of the Community, or the adhesion of new members, have therefore gone into orbit and are now to some extent outside the total control of national parliaments. If that is to be the case, is it not better that the democratic deficit be remedied by the European Parliament assuming those aspects of parliamentary control which have already been lost by national parliaments and would, if not taken up by the European Parliament, be permanently lost to the people of the Community? Will he address himself to that point?
8.45 p.m.
Lord Stoddart of Swindon: I understand exactly what the noble Lord is saying, and I appreciate that certain powers have gone into orbit. His choice is to bring them back down to earth in the European Parliament. I happen to think that the British Parliament, and perhaps other parliaments of the European Community, have lost too much of their

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power and I should like to bring them back down to this Parliament. That is the difference between us. It will be a continuing difference, I have no doubt, but I assure the noble Lord that I understand his point of view. I understand what he is saying and, as a matter of fact, I agree with him that too much power has been lost to secret meetings in bureaucracies and what have you. But if there is to be power of democratic control, I believe it should return here and not be shunted aside to the European Assembly.
I was just going to mention the noble Lord because I was so pleased to have his qualified support. I think it had to be qualified, because he was agreeing with me on the one hand and disagreeing with me on the other hand. Nevertheless I was glad to have a little support from him on the central point I made—that this House would still have the power to discuss amendments and also to agree or disagree those amendments.
The noble Baroness, Lady Hooper, accused me of scaremongering. I do not think she can make that charge stick, because what I did was to point out the facts which she later confirmed. It is not scaremongering to tell the Committee what will happen under the Single European Act. Some people may be in support, as has been shown tonight; others may be against. But it is not scaremongering to tell people the facts of what we are about, and there is no doubt that what we are about is giving the European Assembly additional powers—powers which they have not enjoyed but in future will enjoy.
Baroness Hooper: Will the noble Lord give way very briefly? I did not suggest that he was scaremongering in what he was saying in relation to the amendment. I was referring to his use of the expression "filching power" from somebody else, which suggests to me at any rate a rather furtive way of taking power and which, in view of the discussion today, cannot be held against us.
Lord Stoddart of Swindon: If the noble Baroness is worried only about the word "filching", I do not think we need worry too much. The fact is that we have had a good discussion today, and I welcome it. I am glad that we have had this discussion. though I have to say that earlier on, when I listened to some of the remarks made during the speech of the noble and learned Lord, Lord Denning, and my noble friend Lord Bruce of Donington, I wondered whether the discussion was being wholly welcomed on all sides of the Committee. I welcomed, too, the remarks made by the noble Baroness, Lady Young. We have had a good discussion and I am glad about that.
With regard to the words of Mrs. Thatcher, I have to say to the noble Baroness that I read the words in col. 327 of the House of Commons Hansard of 23rd April. This is what the Prime Minister told the House of Commons:
"positive improvements in the Community's decision making could have been decided in Milan"—
at the conference to which she had just been and about which she was reporting to the House of Commons—
"and did not require any treaty amendment … I saw nothing before us that would require an amendment to the treaty".
That is what the Prime Minister said when she came
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back from Milan. She believed that she could have tied it all up in Milan. But unfortunately she has been overruled by others, I fear, in the Community, and she has had to consent to doing something that she plainly did not want to do.
However, we have had a good discussion. I should like to consider what has been said during the debate. I hold to the view that I put forward at the beginning of the debate but perhaps at this time of night it would be better if we did not press the amendment to a vote. But I say to the Government that we consider the matter to be so serious and important that we may very well want to return to it at Report stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 4 not moved.]
9 p.m.
Lord Bruce of Doningtonmoved Amendment No. 5:
Page 3, line 13, after ("Communities)"), insert ("but not Article 10 thereof").
The noble Lord said: I am glad that in the cool serenity of the evening we have arrived at a stage when there is no longer an almost Pavlovian reaction to anything which might be remotely construed as being critical of the EC. I am most grateful to my noble and learned friend Lord Silkin of Dulwich, and indeed to the noble Baroness opposite, for having enabled these discussions to be conducted in an atmosphere of slightly less hysteria than was conveyed to the Committee earlier, mainly from a sedentary position or from positions which have long since been vacated once the initial job had been done.
This amendment refers to Article 145 at page 293 of the treaty, which reads as follows:
"To ensure that the objectives set out in this treaty are attained. the Council shall, in accordance with the provisions of this treaty, ensure co-ordination of the general economic policies of the member states and have power to take decisions.".
This is a most important responsibility delegated to the Council or made the responsibility of the Council under the terms of the treaty. It deals specifically with general economic policies.
The amendment proposes that it shall be supplemented by the following words comprised in Article 10 of the Single European Act. I propose to read them, because I wish the public to know what these delegated powers are going to be and I also want it put into the record for reference at a later stage. The words are:
"Confer on the Commission in the Acts which the Council adopts powers for the implementation of the rules which the Council lays down. The Council may impose certain requirements in respect of the exercise of these powers. The Council may also reserve the right in specific cases to exercise directly implementing powers itself. The procedures referred to above must be constant with principles and rules to be laid down in advance by the Council acting unanimously on the proposal from the Commission and after obtaining the opinion of the European Parliament".
This is perhaps the first time when powers to determine broad general economic policy have been delegated specifically in this way. We are entitled to ask the Government just how these powers are to be exercised and just what kind of powers they have in mind. I have seen a proposal in a document 5433/86

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addressed by the Commission to the Council that gives some indication. The Commission says in the letter of transmittal, COM(86) 35 final:
"Firstly, it is essential that the Council should amend its rules of procedure as soon as possible, along the lines which the Presidency has already proposed to the European Council in Milan, so that the Council can henceforth put matters to the vote on the initiative of its president or at the request of a majority of its members or of the Commission".
I should like to ask whether Her Majesty's Government endorse the request made by the Commission to the Council.
If one refers to the proposal for a Council regulation dated 3rd March which accompanied that letter of transmittal, one there finds—and these matters have been referred to already by your Lordships' Select Committee—that Article 3 sets out the structure and powers of the various advisory, management or regulatory committees which are to be used generally in the economic process to which the Government are committed, to which the EC is committed and to which I shall refer in more detail when we come to discuss the development of the internal market.
Sufficient for it to be known—and it should be realised now—that under the powers granted to the Commission in this part of the Bill the Commission proposes to act in conjunction with an advisory committee. It does not propose to act in conjunction with either a management or a regulatory committee, because both the management and the regulatory committees are subject to the normal voting procedures, whereas the advisory committee does not require any vote to be taken at all. All that is required is under the proposed regulation in Article 1 on page 5 of the text, which says:
"No vote shall be taken. However, any member of the committee may demand that his views be set down in the minutes".
That means that in so far as the internal market is concerned and under powers conferred on the Commission by this section the noble Lord, Lord Cockfield, and his colleagues in the Commission may act, not in a way that is controlled by any management committee or regulatory committee, but merely through an advisory committee to which they need pay no particular attention.
We have to decide whether additional powers ought to be given to the Commission. This raises two issues: first, the competence of the Commission based upon its past actions and, secondly, the competence of any Council of Ministers from time to time in existence to give any effective direction. I say this in the full knowledge that if I make any criticism of what the Commission has done in the past I am bound to raise immediate paroxysms of rage from those who think that the Commission, by reason of being the Commission of the EC, is composed entirely of archangels who are immune from normal human frailties afflicting even Members of this House.
How effective has the Commission been? It is composed of individuals appointed by member governments for, presumably, a period of time. They are subject to the final nuclear bomb solution in that the entire Commission can be sacked by the Assembly—but that is such a nuclear solution that nobody ever contemplates it. But how competent is
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the Commission? I referred in entirely truthful and sincere terms to the former Commissioner Tugendhat who was one of the most competent commissioners there have been. I could not remember the name of the other commissioner at that time but I now recall that it was Herr Gundelach, the Danish Commissioner for Agriculture. He was the first Commissioner for Agriculture never to duck a question put to him. He would always try to answer Members of the European Parliament honestly rather than evade their questions in the manner of his predecessor and, I regret to say, some of his successors.
Apart from that, how competent have the commissioners been? From time to time, and this has gone on for 11 years, we are told that the common agricultural policy is to be reformed. Year after year, when we have its massive expenditure and massive waste on export rebates, on stock deterioration, storage of surpluses, and so on, we are told again and again that the common agricultural policy—which, among other things, is costing the British taxpayer £1,000 million a year—is to be reformed. What steps has the Commission taken to produce constructive proposals?—because that is the onus that can be laid upon it by the Council. There has been nothing to stop the Commission, ever since 1975, when I was there, from producing comprehensive proposals for reform. That is not competence.
It may be that the Tower at Berlimont produces that easy way of going about matters. I must say that when I have been there it has always appeared to be very leisurely. I say this not in reproach to the noble Viscount the Leader of the House, who always fights assiduously for the interests of Members in this House and, indeed, for the interests of those in another place. Members of the Commission are paid salaries several multiples of those paid to ordinary Members of Parliament and, indeed, some Cabinet Ministers whose personal fortunes I would wish to see increased to the same levels that apply for some commissioners. When they retire, and after taking into account all expense allowances, they probably net a quarter of a million by the time their four-year tenure of office is over. But why is there anything in the Commission's record, as commissioners, that entitles them to have increased powers?
I refer to another aspect of that matter upon which the Committee may be able to make some judgment. I have before me the official journal of the European Community, C.326, dated 16th December 1985. It is the annual report of the Court of Auditors for the financial year 1984. Among other things, it reports on the accounts of the Commission. I can tell Committee Members—those who are in public companies or even private companies in the United Kingdom—that if an auditor had reported on their companies in terms even remotely resembling the comments of the Court of Auditors on the accounts of the Commission and the way it spends money, the instances of fraud, and so on, their companies would, if they were public companies, be deleted from the Stock Exchange list. Indeed, there would be a severe danger that under existing company legislation some directors would be indicted for offences against the Companies Acts.
The report of the Court of Auditors for that year, 1984, is very much on those lines. The noble Lord,

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Lord O'Hagan, and the noble Baroness, Lady Elles, well know that the annual reports of the Court of Auditors on the accounts of the Commission always contain large-scale criticisms which, in the main, the Commission declines to do anything about. Indeed, the Commission believes itself to be in a position where it can ignore the Court of Auditors.
There are plenty of instances, but I shall give only one, which should be sufficient. The case is that of a wine distillation, a fraud in France which cost in British money, at the exchange rate when I made this note—it may have changed slightly since—some £57 million. The Court of Auditors complained about it and the Commission simply brushed it aside. Even while I was in the Budget Committee, under the Budget Control Committee in the European Parliament, the amount of contempt with which the Commission as a whole treated the observations of the Court of Auditors was amazing. As the noble Baroness well knows, the Court of Auditors was instituted at the instance of the noble Lord, Lord Wilson of Rievaulx, when he was Prime Minister. I should have expected any responsible commission to take very careful note of the report of the Court of Auditors and take immediate remedial action.
I tell the Committee that, in my considered view, any commission that cannot instantly take action without demur, and with full resolution, on the report of a properly appointed, recognised and qualified Court of Auditors does not deserve the trust either of the Community as a whole or of the United Kingdom. There is a further reason why we should query the giving of additional powers to the Commission. I referred to it on Second Reading, but, if I may say so without offence, perhaps the noble Baroness was not briefed in detail on those matters.
There is of course a case. It is that which the Commission has apparently been able to bring against the United Kingdom Government, which will be heard shortly, requiring the United Kingdom Government, in accordance with the sixth VAT directive, to impose 15 per cent. VAT on new building. Apparently it has the power to do that. Is it going to be given more powers? We do not know, of course, what will happen to the case. What will be the Government's answer if the European Court of Justice, with its method of operation which the noble and learned Lord, Lord Denning, described earlier on, and of which I endeavoured to give a brief description, after its proceeding decides to order the United Kingdom Government to impose a 15 per cent. VAT charge on all new building? What will the right honourable Lady the Member for Finchley tell the United Kingdom if, suddenly, 15 per cent. is going to be put on new house prices as a result of the successful action by the European Commission?
Can it not be said—I put it no higher than this, and I ask noble Lords please not to get me wrong—that we really ought to take a hard look at all the powers the Commission exercises at the present time and which it is entitled to exercise under the terms of the treaty? We should have a review of how well it has exercised those powers. It is no good asking parliamentary questions at Strasbourg. I have read the replies to the questions that arise. If they do not want to answer questions, they do not bother. They evade. Is it not time that, before
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considering granting any more powers, we had a review of how those powers have been exercised?
Am I being wholly unreasonable in asking that there should be a review? Ye gods, what are Members of Parliament and noble Lords who take an active part in this Chamber there for? Are they there simply to simper, to follow any particular mood, to go along with the mob, to have singsongs from sedentary positions against anything they disapprove; or are they required, on behalf of the citizens of the United Kingdom, to exercise their critical faculties and to examine these matters carefully and objectively and to reach a balanced judgment? That is all I would propose prior to our granting these new powers.
There is also the question of the competence of the Council of Ministers. I should like to remind the Committee that, by and large, the staff of the Commission at the Parliament in Brussels tend to be there permanently. The heads change from time to time. The noble Lord, Lord Cockfield, was removed somewhat precipitately from office after a series of extremely inaccurate predictions about what would happen as a result of the increase in the money supply. That is neither here nor there, but these people tend to be permanent and in the junior and semi-senior staffs they tend to continue on. Therefore they begin to accumulate the power of knowledge and the power of continuity.
It is not so with the Council of Ministers. The Council of Ministers changes. For example, in so far as concerns the United Kingdom component it changes every time that there is a government reshuffle and, by Jove, one knows that although the lady is not for turning we have had a very considerable number of changes over the past two or three years. That means that there is no continuity. We know perfectly well that every member of the Council of Ministers, however much he may be assisted by COREPER and the permanent representatives in representing the United Kingdom wherever the Council meets, still has his own departmental responsibilities to deal with at home. He still has a full-time job. Any Cabinet Minister who reads the papers in his boxes—as I am quite sure does the noble Viscount, the Leader of the House, and indeed the noble Baroness, Lady Young—knows perfectly well that it is a pretty full-time job. We all know quite well—do we not?—save those of us who have a Pavlovian reaction when matters of this kind are pointed out, how much our own members of the Council of Ministers rely on their civil servants. Very often they do not read their papers. In fact, I should like to draw the attention of the Committee to some rather telling phrases in the report of the Select Committee on the European Communities, 1984–85, printed on the 23rd July last year, where at paragraph 75 there is the following gem, which should be engraved on our souls. The Select Committee says:
"So far as meetings of the Council itself are concerned, the Select Committee accept the description given by one of their number: too many people are met in a huge disorderly gathering; most people come with prepared speeches and do not even listen to what their colleagues say. They make no pretence; they do not even have their headphones on".
So much for the Members of the Council of Ministers.
So here we have two weaknesses. First of all there are weaknesses in the Council of Ministers. In many

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cases Ministers probably read their briefs in the aeroplane when flying over to a meeting. They are very much in the hands of their civil servants and are very overworked in their own departments. Then we have a second series of people in the Commission itself whose record in my view still merits very careful examination before any further powers are given to them.
I urge the Committee to give consideration to these matters. If it is found, after a review of their activities, that these people fully merit the new powers that will be given to them, and if it is found that the members of the Council are fully competent to make up their minds about the directions to give them, then of course the Committee will resist this amendment. But if the Committee is open to even the faintest scintilla of doubt in the matter pending further investigation I sincerely trust that it may be moved to support this amendment. I beg to move.
Baroness Young: This amendment relates to a part of the Single European Act which has already been the subject of a report from the Select Committee on the European Communities of your Lordships' House. As the Committee's report pointed out, Article 10 of the Single European Act, which this amendment would negate, is in fact designed to make the functioning of the institutions of the Community more effective. The House of Lords Committee went on to acknowledge:
"the general principle that powers to implement the legislation of the Community should be conferred more often on the Commission. The Community needs to take decisions more swiftly".
The Committee also went on to note that:
"the procedures for the exercise of delegated powers by the Commission should include adequate safeguards".
The Government agree with this approach.
What is at issue is a necessary step toward the more effective implementation of decisions taken by the Council of Ministers. The present situation is that the Council, in taking decisions, stipulates how those decisions are to be carried out. Inevitably, much of the responsibility for the implementation has to be placed on the Commission, guided by committees representing the member states.
I will not be drawn far down the path of the questions asked by the noble Lord, Lord Bruce of Donington. I think that everyone present in Committee tonight is interested in this matter, but those of the Committee who heard the noble and learned Lord, Lord Templeman, speak on Second Reading and who have done as I have and reread what he had to say, cannot fail to be impressed by his wisdom and his description of his experiences and that of the committee with its dealings with the Commission.
The noble Lord, Lord Bruce, raised two specific points which I shall answer. He referred to the efficiency of the Commission and he asked what steps it had taken to reform the common agricultural policy. I would only refer him and the Committee to the Select Committee of this place on the European Communities which in its report on European union said:
"It is significant that the areas in which the Commission works best are those in which its freedom of action is greatest".
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The committee went on to say:
"The extravagances of the CAP are almost entirely due not to the Commission, which has made many proposals for reform, but to the persistent failure or refusal of the Council of Ministers to take hard decisions".
To return to my argument, the exact form in which the implementing powers are exercised has hitherto had to be decided case by case for each Community measure. The result is that some 16 different procedures have grown up over the years and as a result a great deal of time is spent in deciding which procedure to use for which particular circumstance. The aim behind Article 10 of the Single European Act is to streamline the number of different implementing arrangements so that there is a clearly defined and limited number from which the Commission and Council can choose.
There is no question of the Commission usurping the Council's powers to take decisions on Community legislation. The Council will continue to take those decisions as it does now. It will be for the Council to decide whether to confer implementing powers on the Commission. If the Council decides not to do so, it will be free to reserve such powers to itself.
What is new is that where the Council decides to delegate powers to the Commission it will do so according to a previously agreed range of procedures. What those procedures should be is now under discussion by member states and the Commission. Any new procedures can only be agreed by unanimity.
As the noble and learned Lord, Lord Templeman, said on Second Reading, this means:
"that Her Majesty's Government are in a position to insist on such safeguards as they consider necessary".
The noble and learned Lord also said:
"The reason that the safeguards are not written into the Act is that that is not the right place to write them in. The safeguards must be written into the regulation".—[Official Report, 31/7/86; col. 1024.]
It is the content of that regulation that Her Majesty's Government are now discussing with other member states. Those discussions cover the type of safeguards which were recommended by the committee in its report.
In short, the Single European Act makes provision for more implementation of what the Council agrees, but it is the Council which will decide, by unanimity, what form that streamlined implementing procedure will take. When it has done that, it will still be for the Council to decide, case by case, whether to delegate implementing powers. So, our position will be fully safeguarded.
I have set out the position, I hope, as clearly as I can. I hope that the Committee will consider what I have said against what has been said by the Select Committee of this place, and in particular what the noble and learned Lord, Lord Templeman, said on Second Reading. I hope that with those assurances the noble Lord, Lord Bruce of Donington, will withdraw his amendment.
Lord Tranmire: I share the great concern that there is about Article 10. I do not follow what my noble friend the Minister has said. The Select Committee on the delegation of powers is only half way through its consideration. In its report it said that it was a difficult

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problem because it is a tradition of democracy that we do not have the delegation of powers from the legislative body to the executive unless there is reference to a legislative body.
The Select Committee is half way through its investigation. It reported that it had not yet received all the evidence on certain aspects, adding that it would report in the autumn. It is now the autumn, but we have not yet received the report. I wonder whether there is any parliamentary precedent for a major constitutional change being discussed in Parliament before a Select Committee examining that constitutional proposal has made its report. In my 50 years in Parliament, I have not known that to happen before.
My noble friend the Minister said that the noble and learned Lord, Lord Templeman, had made some remarks on Second Reading. The noble and learned Lord, as chairman of the committee, made clear that there would be a further report for the House to consider in the autumn. By the time the report comes out, this Bill, whether it is right or wrong, will be law without the House having considered the report. I believe this to be an unusual procedure. I believe it to be an improper procedure. I hope very much that the Government will give thought to this. The country will not like constitutional change that affects parliamentary sovereignty being decided in this unusual manner.
Baroness Young: I hope that I can reassure my noble friend Lord Tranmire on the points that he has raised. I refer to two conclusions of your Lordships' Select Committee report on the Delegation of Powers to the Commission. Paragraph 59 reads:
"As a general principle, powers to implement in detail the broad rules laid down by the Council should be delegated to the Commission"—
that is what is proposed here—
"but there must be adequate safeguards".
Yes. I have made plain that those safeguards are not ones that can properly be written into the European Act. Those are the ones that must be written into a regulation that is currently a matter of discussion between the member states. Paragraph 60 says:
"Safeguards are needed to protect the interests of persons or bodies directly affected by Commission proposals and major national interests and, in the tradition of democracy, to ensure that legislative acts are not delegated to the executive without reference to a legislative body responsible to the electorate".
These are exactly the kind of points now being looked at. I hope that I have explained them fully. As the noble and learned Lord, Lord Templeman, explained, the report relates primarily to the regulation now before the Council, not to the Single European Act. I hope that with these assurances, my noble friend will see that we are fully cognisant of this matter, but that it is in the interests of the more efficient working of the institutions of the community.
Lord Tranmire: Does my noble friend not agree that this is an interim report? An interim report is followed by a final report. All her quotations are, to that extent, limited until the final report occurs. It is no good
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merely quoting paragraph 60 of the document until we have the final report.
Lord Silkin of Dulwich: I do not want—indeed, I would not be allowed—to anticipate any discussion on my Amendment No. 55 which I still hope may be reached at some time. However, may I assure the noble Lord, Lord Tranmire, that what we are discussing is precisely the reason for the amendment. The amendment accepts that the Bill has become law but defers the commencement date until the Select Committee has finished its task and this House and another place are in a position to give their attention to the recommendations of the Select Committee, the European Parliament and other interested authorities in order to see that the regulation referred to by the noble Baroness is what we would like it to be.
9.30 p.m.
Lord Bruce of Donington: I hope that the noble Baroness may feel constrained to answer in greater detail the points that have been made by the noble Lord, Lord Tranmire. It is quite clear from the reading of the report of the Select Committee that the final report—although it deals to some extent with the adequacy of the scrutiny proceedings and the pre-information requirements—does not exclude further reference to the Single European Act. I should have thought that it would have been best to wait for the Select Committee to have made its final report.
I was somewhat surprised on reading the latest weekly agenda that I can find (although I agree that was dated 1st August, No. 29, the only one available apparently in the Printed Paper Office) to discover that there are no meetings scheduled. I may be incorrect in this; there may be more up-to-date information. That is another example of all the documentation not being available. This is the latest list I have been able to obtain. If, therefore, the noble Baroness can give us some information as to when the appropriate subcommittee of the Select Committee is to meet to discuss this matter, it would give the Committee some guidance as to how long they might have to wait. My noble friend tells me that they will meet next week. His information is conveyed presumably by extra sensory perception, because it is certainly not in the official document. However, I immediately accept what he says.
Apart from a desire to deal with this matter—because it has to be got through somehow—I cannot see why the Government cannot wait for a far more detailed review of the Commission's activities and their effectiveness. I should have thought that this would have been easy to accomplish and at the same time to arrive at a more accurate assessment of the abilities of the Council, acting as a body in conjunction with COREPER and so on, to be able to issue effective directives.
I am very sorry that the noble Baroness cannot accept this amendment. I am afraid that on this occasion I must press it to a Division.
9.33 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 14; Not-Contents, 75.

DIVISION NO. 2

CONTENTS

Bruce of Donington, L.

Ponsonby of Shulbrede, L.

Cledwyn of Penrhos, L.

[Teller.]

Dunleath, L.

Shannon, E.

Elystan-Morgan, L.

Stoddart of Swindon, L.

Gray, L.

[Teller.]

Kilbracken, L.

Tranmire, L.

Molloy, L.

Underhill, L.

Monson, L.

Wilson of Rievaulx, L.

NOT-CONTENTS

Airedale, L.

Caithness, E.

Alport, L.

Cameron of Lochbroom, L.

Ampthill, L.

Campbell of Alloway, L.

Attlee, E.

Campbell of Croy, L.

Banks, L.

Carnegy of Lour, B.

Beaverbrook, L.

Coleraine, L.

Belstead, L.

Cornwallis, L.

Bessborough, E.

Craigavon, V.

Boardman, L.

Craigmyle, L.

Brabazon of Tara, L.

Craigton, L.

Broadbridge, L.

Crathorne, L.

Brookes, L.

Croft, L.

Brougham and Vaux, L.

Culler of Ashbourne, L.

Broxbourne, L.

Davidson, V. [Teller.]

Bruce-Gardyne, L.

Denham, L. [Teller.]

Butterworth, L.

Dulverton, L.

316

Eccles, V.

Lucas of Chilworth, L.

Elles, B.

McNair, L.

Elliot of Harwood, B.

Maude of Stratford-upon-

Elliott of Morpeth, L.

Avon, L.

Faithfull, B.

Mersey, V.

Fortescue, E.

Monk Bretton, L.

Gainford, L.

Newall, L.

Gisborough, L.

O'Hagan, L.

Gladwyn, L.

Reay, L.

Glenarthur, L.

Rochdale, V.

Grimston of Westbury, L.

Rodney, L.

Halsbury, E.

Romney, E.

Harris of Greenwich, L.

Saltoun of Abernethy, Ly.

Hesketh, L.

Seear, B.

Hives, L.

Skelmersdale, L.

Hooper, B.

Stedman, B.

Houghton of Sowerby, L.

Swinfen, L.

Hylton-Foster, B.

Tenchard, V.

Kennet, L.

Trumpington, B.

Kilmarnock, L.

whitelaw, V.

Layton, L.

Winstanley, L.

Long, V.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
9.41 p.m.
[Amendments Nos. 6 and 7 not moved.]
Lord Bruce of Doningtonmoved Amendment No. 8:
Page 3, line 13, after ("Communities)"), insert ("but not Article 13 thereof").
The noble Lord said: I beg to move Amendment No. 8 standing in my name and at the same time I should like to speak to Amendment No. 9. We now pass to perhaps what are the most important economic amendments which the Committee may have to consider, because they add new articles immediately following the existing Article 8 in the Treaty of Rome. The Committee will recall that at page 181 the Treaty of Rome states:
"The Common Market shall be progressively established during a transitional period of 12 years.
This transitional period shall he divided into three stages of four years each: the length of each stage may be altered in accordance with the provisions set out below",
and so on. I shall not weary the Committee by giving a complete recitation of Article 8. Nevertheless under the Single European Act some new articles are proposed.
Comprehensive though they may be, the provisions of the treaty at Article 8 are evidently not considered sufficiently definitive for the Community to be able to continue satisfactorily. Therefore, in Article 13 of the Single European Act it is proposed that the following articles should be added to the existing provisions of the treaty. There is Article 8A, which states:
"The Community shall adopt measures with the aim of progressively establishing the internal market over a period expiring on 31 December 1992, in accordance with the provisions of this Article and of Articles 8B, 8C, 28, 57(2), 59, 70(1), 84, 99, 100A and 100B and without prejudice to the other provisions of this Treaty".
It goes on to say:
"The internal market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of this Treaty".
In Article 14, which follows, it is proposed that Article 8B be added:
"The Commission shall report to the Council before 31 December 1988 and again before 31 December 1990 on the progress being made towards achieving the internal market within the time limit fixed in Article 8A".
The second paragraph reads:
"The Council, acting by a qualified majority on a proposal from the Commission, shall determine the guidelines and conditions necessary to ensure balanced progress in all the sectors concerned".
Then Article 8C reads:
"When drawing up its proposals with a view to achieving the objectives set out in Article 8A, the Commission shall take into account the extent of the effort that certain economies showing differences in development will have to sustain during the period of establishment of the internal market and it may propose appropriate provisions".
The final paragraph of Article 8C is,
"If these provisions take the form of derogations, they must be of a temporary nature and must cause the least possible disturbance to the functioning of the common market.".
The essence of these proposals is a formal enunciation within treaty terms of policies which seek to ensure that the maximum freedom takes place in the exploitation of the earth's surface and of its products; that the utmost freedom in the operation of the market, the operation of wealth, the movement of capital and the movement of people is ensured. In
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short, it is a complete reversion on official lines and given official blessing within a treaty to those disastrous economic policies that were followed out in the United Kingdom before World War II, which in part contributed to its outbreak and which in any event, with the weakest to the wall and the devil takes the hindmost—I am sorry that the noble Lord is so mirthful about it. It was serious for the people who were living at the time.
9.45 p.m.
The Earl of Lauderdale: I hope the noble Lord will forgive me, but I have just come back from dinner. Some of us find the speeches of the noble Lord of great interest, but they are also of great length and have come to be described as Margaret Thatcher's secret weapon.
Lord Bruce of Donington: I accept the noble Earl's most courteous rebuke. It is my experience that when people begin to hear uncomfortable truths they seek always to denounce them by complaining of their length, but very rarely of their accuracy.
The Earl of Lauderdale: Will the noble Lord allow me to intervene again? I rather agree with much of what the noble Lord says, but if he could say it in five instead of in 35 minutes he would get more support.
Lord Bruce of Donington: I am very grateful to the noble Earl for giving an indication of sympathy in principle. If his sympathies were that strong he would not complain of the extra explanatory effort I have to make to reach people who are probably of less intellectual attainment than his own.
Baroness Elles: I consider that to be an insulting remark and I hope the noble Lord, Lord Bruce, will withdraw it.
Lord Bruce of Donington: I can assure the noble Baroness that my remark made no reference to her whatsoever. If the cap fits it can always be worn, but it was intended for a far wider audience of people who otherwise might not be able to understand the contents of what we are debating here, including the wisdom that falls from the lips of the noble Baroness from time to time.
There is the enshrining in a treaty of the apparent success of the policy of completely free movement of capital, persons and everything else throughout the Community. In more sober moments Ministers have thought otherwise, because when they were considering this matter in the Dooge Committee (which they were some little time back) there was complaint, from which Mr. Rifkind did not dissent, that one of the reasons why they wanted to reorganise and put a bit of zest into the Community was this quote from the Dooge Report:
"Furthermore, after ten years of crisis, Europe, unlike Japan and the United States, has not achieved a growth rate sufficient to reduce the disturbing figure of almost 14 million unemployed".

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So much for the success of the free policies that have been adopted throughout Europe and which now it is sought to enshrine in treaties in order to give them an intellectual validity that they do not possess. Even the Select Committee of your Lordships' House in reporting on European union, and again in its reports on the effects of harmonisation of taxes and so on, refers to the manifest benefits of a large European market. Where are they manifest?—when the Dooge Report itself complained that they have not been able to do much anyway. Why, therefore, is it that there is this instinctive reaction that any large-scale market must inevitably produce prosperity and economic success? A lot of balderdash! In fact, it produces very large incomes for a small number of people.
Baroness Seear: May I ask the noble Lord what it was that he called it?
Lord Bruce of Donington: Balderdash! It produces large profits for a very small number of companies, although 200 of the most profitable companies in Europe happen to be British. It also produces an underutilisation of resources; it produces large-scale unemployment and it produces all the evils from which not only we ourselves but other countries in Europe have suffered and are still suffering at the present time; so much so that it has given us a justification for taking another look at European organisation.
Do we always have to assume that large-scale economic activity carried on on a free enterprise principle over a large area is bound to give success? It certainly is not. All history proves that it is not. The European Community and some of its economic advisers may complain of the effects of the world depression upon it, but it was precisely the founding of the European Economic Community, the gathering together of a large number of nations, to create a market on a European scale that was supposed to be exactly the insurance against the economic depression of which people, particularly the Government, speak as though it were some kind of heaven-awarded deluge outside the control of man, that it was some kind of supernatural visitation; whereas, of course, it arises precisely because of the daftness of the whole policy of free enterprise, the whole daftness of the policy of the unrestricted movement of capital, persons and all the rest of it, which this seeks to enshrine.
The achievement of the internal market in Europe surely should be based upon a much sounder basis. If there is going to be this freedom and there is going to be this harmonisation to which they refer, do not Her Majesty's Government realise that the economy of the United Kingdom and the economy of Germany and all the rest of the individual countries have special characteristics all of their own? They are not equal; they do not bear equal burdens; they do not have equal tasks and they have different histories. To try to harmonise them and bring them all together in this glorious competitive enterprise takes no account of the number of things. When I hear my fellow countrymen
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talking of their own country—in which it is, I suppose, still legitimate to have some pride—I sometimes wonder whether they forget the burdens that this country bears.
If we are going to have harmonisation within the internal market should we not, for example, start off with harmonisation of defence expenditure? Defence expenditure creates a very considerable impact on the United Kingdom budget. It has a very considerable impact on our standard of living here. Yet what do we find? We find that the United Kingdom in 1984 spent some £30 billion on defence, which was more than the combined defence expenditure of Italy, the Netherlands, Belgium, Greece, Denmark, Ireland and Luxembourg. Yet we are supposed to be assessed as though we are on an equal basis—and incidentally we spent some £3 billion more than West Germany and some £4 billion more than France per annum. These are matters which have to be taken into account in determining the extent to which the internal market of individual countries and the collective can develop.
There are also diverse rates of interest. People talk as though the establishment of the movement of goods in Europe was the only point at issue. There are a number of factors which are not taken into account, and they certainly should be if there is going to be any future at all. I think, and I sincerely trust that Members of the Committee may be constrained to agree with me, that whatever views there may be about the internal market, and whatever views there may be about the ways in which the various countries of Europe should pursue their economic policies, it is profoundly unsafe to lay down principles as a dogma, either in the treaty or in resolutions applicable to all member states, regardless of their circumstances. It has never been attempted before and, in my view, it should not be attempted again.
Earlier today when I ventured to speak to your Lordships on the Motion, That the House do resolve itself into a Committee, I said with such seriousness as I could muster that very considerable economic troubles lay ahead for our country and that it would need all our individual and co-ordinated efforts within our own country and subject to our own governmental flexibility to extricate ourselves from the difficulties we shall shortly face, with the progressive decline not only in the value of oil supplies—which are our principal export to Europe—but also the decline in its price, which may or may not continue.
I said that the case for the large market guaranteeing prosperity was not proved. In fact the reverse is true, as a matter of experience. Austria has an inflation rate of 2½ per cent., with unemployment of about 2 per cent., and a per capita standard of life which is higher than our own. Similar observations apply to Sweden. There is no particular virtue in bigness. On the other hand, there may well be a virtue in compactness and in the flexibility of decision in acting in unison within a smaller area rather than within a larger area.
I would remind the noble Baroness, who will doubtless be charged with the enshrining of this particular internal market as official dogma enshrined in the treaties, that Japan, who is always held to be one of the leading examples of successful enterprise in the world, does not operate under these principles at all. In fact, if she reads the Financial Times of 20th

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September she will find that MITI and the Japanese Government have decided to invest £15½ million in Japanese industry in order to stimulate that industry and in order to stimulate not only demand but also investment, and to increase the productivity of their country.
The reason I have asked for the Committee's support for these amendments is that I consider it dangerous that these principles should be inscribed in the treaty and thereafter become inscribed on blocks of stone at which, no doubt, the Alliance will come to worship in due course. We should retain our own national ability to deal with our economic troubles and our own economic development in our own way, with as much co-operation with Europe as possible and with as much friendly exchange of views and commerce as we can possibly manage.
That should be done not in hostility but in co-operation, because they need us more than we need them. They need our markets for their manufacturers and they would be very sorry to have us out of it; so let us not consider we are in a position of inferiority in relation to them. I hope therefore that the Committee will support these amendments. I beg to move.
10 p.m.
Baroness Young: In its report on the European union the Select Committee of this Chamber on European Communities said:
"The wider the home market which European industry can develop, the better equipped will it be to cope effectively in the world market".
That simple truth, repeatedly emphasised by the Select Committee in their report, is a fundamental reason why completion of the internal market must not be delayed.
They went on to say:
"The Community has achieved much but progress is being held up because necessary decisions are not being taken, particularly in completing the internal market. The Community decision-making process will not be unblocked without more majority voting. This is essential."
Those words concerning the Community decision-making process being unblocked by more majority voting were considered essential by the Select Committee of this Chamber on the European Communities.
The main achievement of the Single European Act is to help unblock decision-making to enable us to achieve our long-standing goal of completing a common market in goods and services.That means the abolition of non-tariff barriers to trade, the freedom to provide services in which the United Kingdom is particularly competitive, and the liberalisation of air, sea and road transport. Those are issues which I may say have frequently been discussed in this Chamber. Indeed, the current trade barriers are estimated to cost the Community £7 billion a year and they cost this country a disproportionate sum.
I can confirm to the noble Lord, Lord Bruce of Donington, that our markets are open to our competitors. Their markets are not always open to us, so completing the internal market is not about opening our markets to competition which we shall not be able to match but rather about redressing the balance, and opening up opportunities in sectors such as financial
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services where we are indeed market leaders. That is why this Government have steadily campaigned to get the creation of what is now called a single large market, or, more simply, the internal market, put at the top of the Community's agenda.
In the beginning, we received little support from our partners, but over the past few years the reasons that convinced us of the need for a genuine internal market have convinced our partners, too. So long as Europe remains split up into 12 small national markets, many of them heavily protected, European business and industry stands no chance of competing with its counterparts based in the large unified markets of the United States and Japan. Our firms need a large market, both to give them the strength to compete on their own ground in Europe and as a springboard to compete on world markets.
As the noble Lord, Lord Bruce, is so assiduous in his researches on Europe, his researches will unquestionably have led him to recognise that not every one of the 12 countries who have signed the Single European Act are in fact pursuing policies that are indentical to those of Her Majesty's Government. Nevertheless, they recognise the advantages of the full internal market.
The large European market is not just in the collective interest of the member states; it will also be very much to the advantage of the United Kingdom. Our own market is among the most open in the world. The same sadly cannot be said for that of many of our partners and any British business man will tell you about the bewildering variety of formalities, procedures and outright barriers which he faces when he tries to sell in the European market. Creating the internal market means breaking down the barriers. We have few, while some of our partners have many, and the net result will in practice be to open up substantial new export markets to British business.
Article 13 of the Single European Act, to which the amendment now before us refers, would write into the Community treaties a clear and explicit commitment to the creation of an internal market by 1992. It is only by setting a clear target that we could hope to introduce the sense of urgency which we need if we are to make speedy and solid progress.
The second amendment, No. 9 on the Marshalled List, which we have been discussing, relates to Article 15 of the Single European Act which would require the Commission's proposals on the internal market to take account of difficulties faced by less developed economies in the Community and in suitable cases to allow for derogations.
We must, of course, preserve the broad principle of a unified internal market, but at the same time there has to be some flexibility to help cope with exceptional cases of difficulty. If there were no such flexibility, the Community would sometimes be forced to choose between ignoring the special difficulties of one member state and making no progress at all. A balance has to be struck. That is why this provision confers no right of derogations but obliges the Commission to consider proposing them. This should ensure that any departures from the principle of a unified market are strictly limited, both in scope and in duration. At the end of the day, it will always be for the Council to decide what special provisions, if any, are necessary.

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At present, a member state which wants to secure special provisions for itself can simply block a measure indefinitely until it gets its way. From now on, it will have to make a case for special treatment and persuade the Commission that a majority of member states accept it.
These provisions add up to a broad vision of a unified internal market, a commitment to achieve it by 1992 and a recognition that a unified market does not necessarily mean a uniform market. This is what we have always hoped the European Community would ultimately achieve. It is good for Europe and, more to the point, it is good for Britain. That is why I am convinced that these amendments must be rejected.
Lord Stoddart of Swindon: I listened carefully to what the noble Baroness said, as indeed I listened carefully to what my noble friend Lord Bruce of Donington said. I must confess that listening to the noble Baroness I had the feeling that I had been there before, for I heard all these arguments in 1972 about what Britain needed to revive her industrial potential, to sell more cars and to sell all sorts of other goods was the chill wind of competition from the EC. If only we would join the Common Market, that would cure us of so many of our ills.
I remember Sir Donald Stokes, who is now a distinguished Member of this House, writing to my constituents at British Leyland saying "You know, there is only one hope for your job in the car industry. There is only one way by which the British car industry can be saved. That is by remaining in the EC", and recommending therefore by implication that my constituents should vote accordingly. That was the story. That was what we were told.
We were told in 1972 and in the years before by representatives of both parties—I make no secret of that—that the great hope was this wider market, this home market of 250 million people; that would give us the great opportunities for expansion of our industrial base and for our exports. Those were the promises that were made. I can well remember people being told that their wages would rise almost overnight by £7 a week. and pensioners and other people were told that their benefits would rise to the level of the Common Market. Those were the things we were told about entering the EC and remaining in the EC.
Baroness Young: I said at the start of these proceedings that we had no wish to curtail anybody's discussion of the amendments before the Committee, but I believe that, however strongly the noble Lord may believe that we should not have entered the Community, we are in it, and that is our starting point.
Lord Stoddart of Swindon: I accept absolutely what the noble Baroness has said, but to lead me to the point it is necessary to make the points I have already made. We were told originally before we went in that joining this large market was to be our salvation. That has not proved to be the case. Far from our industrial base expanding, far from being on the winning side in relation to trade, we find that in manufacturing trade our deficit has now reached the sum of £9 billion,
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whereas in 1972 with the original six members of the EC we ran a surplus.
Baroness Elles: Does the noble Lord recall that a year after joining the Community we had the benefit of a Labour Government for six years, which certainly did not assist our manufacturing industry and did not help the formation of an internal market for the benefit of the United Kingdom? We have still to live with the results of that.
Lord Stoddart of Swindon: Far from not helping our manufacturing industry, the Labour Party arrested the decline in our manufacturing industry—
Noble Lords: Oh!
Lord Stoddart of Swindon: Yes, indeed. But since the Labour Government left office in 1979 our manufacturing base has gone headlong downwards, and manufacturing output, in spite of what Mr. Paul Channon said on television this morning, is still 6 per cent. below what it was in 1979. Those are the facts.
Far from our membership of the EC giving us this great bonanza and saving our manufacturing industry from decline, we are now running a manufacturing deficit of £9 billion, the equivalent of more than 1 million jobs. We are told, "Ah, yes, but that is because we did not complete the internal market. If only we now proceed to complete the internal market everything will be hunky-dory, everything will come right". As I said, I have heard it all before. Indeed, to obtain the consent for this internal market the British Government have agreed, as we discussed earlier, to a certain sacrifice of their own sovereignty and the sovereignty of Parliament.
I do not believe that the noble Baroness can give this Committee the assurance sought by my noble friend Lord Bruce of Donington that by completing the internal market we will solve the deep-seated problems we have in this country which, in my view, have largely arisen as a result of our membership of the EC. There is in fact no guarantee of it and it may well be that far from improving our situation—
10.15 p.m.
Baroness Seear: May I interrupt the noble Lord? Since our late and much lamented colleague Lord Kaldor was for ever telling us that the decline in the British Economy started at the end of the 19th century, how can our present plight be attributed to membership of the EC?
Lord Stoddart of Swindon: Of course it has declined, but I must go back to my original point. We were assured that the decline would be arrested by joining the EC. However, instead of the decline being arrested the decline has quicked and steepened.
We have not seen the benefits which were promised at the time of our entry, They have not been delivered. There is no guarantee that any promises will be met as a result of completion of the European market. There is a danger that far from benefiting from completion of the European market, we shall have the reverse—we shall suffer from completion of the European market. Whereas up to now we have suffered badly in relation

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to manufactured goods, we may very well suffer badly and adversely in relation to services, too. There is no guarantee that by completing the internal market the benefits which have been promised will flow. We are taking an enormous gamble. Frankly, it is a gamble which we should not take.
The destiny of this country depends not on joining, remaining in or expanding a market with a group of other people. Our destiny will be controlled by what we do here ourselves, on what leadership is given by this House, by government, by industry and by the trade unions. It is my belief—and I have said this before and I say it now—that over a long period of time there has been a failure of leadership in this country. The country has not been told what are the real remedies. There has not been sufficient courage to impose those remedies. I am afraid that that is still the case. Courage is lacking. We are looking for panaceas, but they will not work.
Lord Molloy: I think it is probably right, as the noble Baroness said and as I said earlier, that this is not an argument on whether or not we stay in the European Community. We are in the Community and that was decided by a referendum.
What I find disturbing is that at the time of the referendum many Members of the Liberal Party, if not all of them, were telling us that membership would save our bacon; that we must go in. We now have the noble Baroness, Lady Seear, telling us that we cannot place the blame for the terrible plight that we are in—and we are in a serious plight—on our membership of the EC.
I listened to the noble Baroness, Lady Young. I could not believe, from what she said, that we are in such a frightful situation. I could not believe that we have roughly 4 million Britons on the dole, unemployed, going to waste. I could not believe that the construction industry of this country is crumbling, despite joining the EC. I am not going to say that it is because we joined the EC that we are in this awful situation, but what is beyond dispute is that this nation of ours is in a serious and appalling situation because of the management of the Conservative Government. That cannot be denied unless you are going to say that we have no unemployment; there is no crisis in the health service; education has not become a talking point of vital importance throughout the nation; we can house the people of this country; and there has been no dramatic and appalling decrease under Conservatism in law and order in Great Britain. If you ask what all this has to do with the EC—
Lord Bruce of Donington: We are talking about the amendment.
Lord Molloy: As the noble Lord said, we are discussing the amendment. We do not want to discuss too much his attitude at various times. Right or wrong, I have remained here where I believe I ought to be. One does not run away because things are going wrong. This cannot be said of some other people. The mass of the ordinary people do not understand what the Single European Act and these articles under discussion are about, and they wuld not be too concerned whether they remained part of the Single European Act or whether the amendment from the Labour Benches was accepted.
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I find it very disturbing that that should be the situation throughout this nation; that so few of our fellow Britons understand what is at stake. The noble Baroness told us that in all that is happening in Europe there is no actual unity, and there is not the same sort of government everywhere, and I think that is a very good thing. But what is very bad is this. There is not much use in saying that one of the joys of being part of the European Community is that there are a few countries which are even worse off than we are. I do not see the sense of that whatsoever.
If we had time to explain to a class of average people what is involved in the Articles under discussion, I believe there would not be much hesitation in ordinary folk joining the Labour side of this ancient Chamber and deciding that we ought to accept these amendments tonight. That is for not any political reason, but because we have to put our country first and move much more cautiously and steadfastly. We have to start putting what is wrong with this country right before we embark on threatening our future with some of the things suggested in the Single European Act. It is on that simple basis that I believe that we ought to support these amendments tonight.
The Deputy Chairman of Committees (Lord Strabolgi): Is the noble Lord withdrawing his amendment?
Lord Bruce of Donington: I am sorry that the Minister has not been able to be more forthcoming; but in view of the lateness of the hour and the distinguished quality of your Lordships who remain, I think it would be best to ask the Committee for leave to withdraw the amendment.
The Deputy Chairman of Committees: Is it your Lordships' pleasure that the amendment be withdrawn?
On Question, amendment negatived.
[Amendment No. 9 not moved.]
Lord Bruce of Doningtonmoved Amendment No. 10:
Page 3, line 13, after ("Communities)"), insert ("but not Article 26 thereof").
The noble Lord said: I beg to move Amendment No. 10 standing in the name of myself and my noble friends. I should also like to speak to Amendments Nos. 11, 12, 13 and 17, which for the purpose of saving time have been grouped in order that they may be discussed together.
It is important that we know just what the effect of Article 16 of the Single European Act will have on the treaty.
Once again, for the wider information of the public who may be interested, as well as for members of the Committee and for purposes of the record, I should like to inform the Committee exactly what effect the amendments that are proposed to the treaty in Article 16 will have. Article 16 refers to Article 28 of the EEC Treaty which is now to be replaced. Before amendment Article 28 reads as follows:
"Any autonomous alteration or suspension of duties in the common customs tariff shall be decided unanimously by the

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Council. After the transitional period has ended, however, the Council may, acting by a qualified majority on a proposal from the Commission, decide on alterations or suspensions which shall not exceed 20 per cent. of the rate in the case of any one duty for a maximum period of six months. Such alterations or suspensions may only be extended under the same conditions, for one further period of six months".
The new article, which supersedes Article 28, to be put into the Treaty of Rome merely states:
"Any autonomous alteration or suspension of duties in the common customs tariff should be decided by the Council acting by a qualified majority on a proposal from the Commission".
When the noble Baroness comes to reply, I should like a further explanation from her as to exactly why the restrictions contained in the former article have given place to the rather shorter form as in the proposed change. I am not expressing any particular antagonism to it: I should just like the explanation of it.
Then in paragraph 2 of Article 16 there is a reference to Article 57 of the Treaty of Rome. The Committee will recall that Article 57 is within that section of the Treaty of Rome that gives the right of establishment. I quote from paragraph 1 of Article 57 which deals with a measure:
"In order to make it easier for persons to take up and pursue activities as self-employed persons".
which is the whole context of the matter. When it is amended by paragraph 2 of Article 16 in the Single European Act, Article 57 of the treaty will read as follows:
"For the same purpose, the Council shall, before the end of the transitional period, acting on a proposal from the Commission and after consulting the Assembly, issue directives for the coordination of the provisions laid down by, law, regulation or administrative action in Member States concerning the taking up and pursuit of activities as self-employed persons".
Then the last point is inserted by paragraph 2 of Article 16 and it now says:
"Unanimity shall be required for directives the implementation of which involves in at least one Member State amendment of the existing principles laid down by law governing the professions with respect to training and conditions of access for natural persons".
That is how it now reads, and it is up to the Committee to decide whether this amendment will in fact serve the purpose described.
I am bound to declare an interest, although not a personal one, in the establishment particularly of professional bodies overseas. The Committee will remember—although it does not arise under this section, and I do not know how it will be influenced now when the new single Act comes into operation—that since 1975 insurance firms operating in the non-life field have been trying to operate in Germany. The first time that I saw the directive was when I was a member of the Budget Committee and the Economic and Monetary Affairs Committee of the European Parliament. I well recall how matters were filibustered, not by the Council but by the Parliament.
One of the characteristics of the Parliament is that it is manned by nationals of various states, including our own. The British employees do not always maintain the continuity with their Government that the German or French staff maintain with their governments. They do not always operate in the disinterested and impartial manner which is supposed to be the characteristic of European parliamentary
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staff. As a result, as the noble Lord is well aware because I have complained aboout it before, the matter was filibustered, by the simple machinery that every time it was put on the agenda by the British, including myself, mysteriously neither the French nor the German rapporteur turned up and therefore the subject was not discussed. Then, for some mysterious reason, it was forgotten and not put on the agenda for the next meeting.
There are all kinds of dodges of which the noble Baroness, Lady Elles, is well aware. They probably no longer continue in the European Parliament. I am all for the adoption of this clause if it assists in any way in that respect, but I prefer to leave it to the Committee's judgment.
Article 59 deals with services and covers the matter that I have just been discussing. The only alteration to Article 59 on services is that:
"The Council may, acting on a qualified majority, on a proposal from the Commission, extend the provisions of this chapter to nationals of a third country who provide services and who are established within the Community."
The rigid enforcement of that would probably be of material assistance to the service industry concerned. However, I am bound to say from bitter experience that the only nation that enforces Community law to the letter is probably the United Kingdom. If anyone can cross his heart and say the same about our good friends across the Channel, I should be delighted to hear any tributes to the meticulous manner in which they apply the regulations.
Paragraph 4 deals with a most important matter. I give notice that I am bound to divide the Committee on this amendment unless I have the agreement of the Committee. In our present economic circumstances this is possibly the most important matter. Article 70 states:
"The Commission shall propose to the Council measures for the progressive co-ordination of exchange policies of Member States in respect of the movement of capital between those States and third countries".
The old wording was:
"For this purpose the Council shall adopt directives by unanimous decision. It shall endeavour to obtain the highest possible degree of liberalisation".
That has now been eliminated.
I hoped that the noble Lord, Lord Bruce-Gardyne, would be present when this matter was discussed, because he is interested in City matters; but no doubt he will read the Official Report tomorrow. The proposed wording is now:
"For this purpose the Council shall issue directives, acting by a qualified majority. It shall endeavour to attain the highest possible degree of liberalization. Unanimity shall be required for measures which constitute a step back as regards the liberalization of capital movements".
Here we have an example of the ratchet effect of legislation relative to the Community. Anyone in this Chamber who, in present circumstances, would seek to justify an attempt to achieve and to make permanent the liberalisation of measures dealing with the movement of capital and the exchanges—I say this with the greatest possible respect—needs to have his or her brains examined. Exchange rates vary from day to day between countries. It has nothing to do with any alleged stability implied by the European Monetary

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System. A price has to be paid for stability. The question that arises is stability at what level.
Interest rates at the moment vary between countries. These rates, as the Chancellor of the Exchequer has belatedly found out, have a profound effect upon the movement of capital in and out of the country to third countries. I shall give figures to show how interest rates—these are prime lending rates for commercial banks—vary. In Belgium, the figure is 10·5; in Germany, 7; in Holland, 7; in Italy, 13·5; in Spain, 14·5; in Switzerland, 7·25; and in the United Kingdom, 11. Anyone who can think, in those circumstances, of freeing everything, must not understand at all how the economic system works. Everyone knows that liberalisation of the ability to dispatch capital wherever it can find the highest interest rate or wherever, on a speculative basis, it can expect a higher return either for venture investment or permanent investment, means that billions and billions of capital slushes to and fro across the world day by day causing violent exchange rate fluctuations and causing defensive or attractive measures—the stick and the carrot in respect of the movement of interest rates.
In its wake, this leaves people. It leaves enterprises which cannot move with the speed of light to follow capital wherever it goes across the world. The people in the little streets of Britain are tied in the main to their localities. When capital moves out and when prospective resources move away—resources that could be used for investment—it is their futures that are in hock. The results are already apparent in Europe. Just as the pursuit of these kinds of policies within the United Kingdom has produced regional differences with money pouring into the more profitable sections, while the life is sucked out of the poor sections, so it is on the Continent of Europe.
The peripheral countries of the Community are those that contain the distress areas. Meanwhile, people in the golden triangle of Frankfurt, Paris, London, and possibly Amsterdam, attract the money. They attract money against which no regional fund can ever make any impact. After all the adventures in regional development—we pay almost as much as we receive—the poor parts of the Community are getting poorer and the rich are getting richer. This is a time when the situation in Europe and, for that matter, in the world requires intelligent investment and planning on the same lines as is being carried out in Japan while maintaining free enterprise. To talk of further liberalisation in these circumstances must be complete folly.
I am sorry to have to speak so strongly about this matter, but Members of the Committee will recall that some of the speeches I have made—however long I regret they may have been over these past few years—have still to be proved wrong. In the debates I have taken part in since 1979, when I spoke on economic affairs, my main predictions have unhappily come true. I sincerely trust, bearing in mind that this treaty may have to go for revision, that the Committee, in its wisdom, will see fit to remove this clause in relation to the Single European Act. It bodes very badly indeed for the whole future of our economy and will put us in extreme danger, particularly in the next couple of years. I beg to move.
Lord Campbell of Alloway: I should like to pay tribute to the way in which the noble Lord, Lord Bruce, has deployed the argument before the Committee. I shall be very brief. The argument on the interest rates is not so readily understood because there is no formal or legal obligation involved. If I am wrong on this I would seek immediate correction. However, this amendment, and the grouped amendments, affect the implementation of the internal market. As I think has been said before, it has been agreed by Ministers that there must be a measure. These measures of further devolution of power—if you like, surrender of sovereignty—from the parliament, not just of our parliament but each of the member states, on matters governed within the domain of the three treaties, are simply to establish completion of the internal market by 1992.
The noble Lord, Lord Bruce, quoted from the treaty. He referred to a transitional period. That was the third section of the 12-year transitional period which should have been completed by 1969, three or four years before we acceded to the Common Market. Surely, if one is taking an objective stance on this matter, what was not achieved before we went in ought to be achieved within some measurable prospect of time after we have entered. This situation simply cannot be reached unless the decision-making process involved in achieving this internal market were to be unblocked as proposed by this Bill, the SEA, and as recognised in Stuttgart and Milan.
Is it right that we should now suddenly crash the gears into reverse, and for some totally illogical and unsupportable reason say, "We do not want to achieve the internal market. What is the object of achieving it?" If we do not want to achieve it, we should resign or withdraw. On this I totally accept the integrity of purpose of the noble Lord, Lord Bruce of Donington, and accept that that is not the object of the exercise. But he will accept the sincerity of my view that if he presses any single one of these amendments that will be the realistic effect. For those reasons, I would oppose the amendment.
10.45 p.m.
Baroness Young: The amendment now before us. No. 10, would delete Article 16 of the Single European Act, under which qualified majority voting would be extended, subject to certain qualifications, to 5 provisions where the treaty currently requires unanimous decisions. All these articles are directly related to the internal market.
It may be helpful to the Committee if I explain briefly why member states came to the conclusion that some extension of majority voting was desirable, and why the particular articles covered by this amendment were selected.
First, as the Committee will know, over 40 articles of the treaty already provide for decisions to be taken by a simple or qualified majority. These include a number of articles directly related to the internal market, for example articles relating to the right of establishment, the freedom to provide services and common policies on inland transport. So, the possibility of majority voting on matters affecting the internal market is certainly not a radical innovation.

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I have already referred to the disappointing rate of progress over the last few years on internal market questions generally. Member states, including the United Kingdom, came to the conclusion that one of the reasons why progress had been slow was that individual proposals were frequently blocked for months, and sometimes for years, by one member state in isolation, all too often over a relatively minor point of special interest to it. Member states therefore came to the conclusion that their interests would be better served, both individually and collectively, by some extension of the existing scope for majority decisions. The Government fully agree.
Turning now to the specific provisions covered by Article 16 of the Single European Act, the first of these is Article 28 of the treaty, under which autonomous alterations or suspensions of common customs tariff duties are made to meet changing market conditions. I should emphasise that we are not talking here about the general common customs tariff regime, which is one of the major trade policy questions which falls to be decided under Article 113. What we are talking about here is a large number of detailed tariff suspensions for particular products to facilitate imports into the Community (or occasionally to make them more difficult) where changing market conditions require this. Over a thousand such detailed tariff suspensions and alterations are made each year. Many of them are already subject to majority voting under the existing terms of Article 28. The Single European Act will ensure that all of them are subject to majority voting. This should make it easier to meet fast moving changes in the market conditions. In view of this, and of the fact that the general common customs tariff regime is already subject to majority voting under Article 113, I hope the Committee will agree with me that this change will be a useful one.
The second article affected is Article 57(2), under which decisions are taken to facilitate the pursuit of activities as self-employed persons throughout the Community. The effect of the Single European Act will be to narrow slightly the areas in which member states can block progress in this important area by invoking the unanimity rule.
Next we have Article 59, which provides for the progressive abolition of restrictions on the freedom to provide services in the Community. At present, decisions can be taken by qualified majority where Community nationals alone are affected, but must be taken by unanimity if third country nationals are involved. Most Community measures relating to services apply equally to Community nationals and to nationals of third countries who are formally established within the Community. The net result is that the unanimity requirement for third country nationals prevails, and most decisions have to be taken by unanimity.
The Single European Act would ensure that measures relating to the freedom to provide services should be taken by qualified majority regardless of whether they covered third country nationals of the kind I have described. This would make it easier for the Community to make rapid progress on opening up the market in the provision of services, an area where
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the United Kingdom is particularly well placed to benefit from an open European Market.
The noble Lord, Lord Bruce of Donington, asked about the prospects for non-life insurance services directives in opening up the German market. I can confirm to him that we hope that the change to Article No. 57(2) will make it easier to secure the adoption of the long standing draft directive on non-life insurance services. Indeed some noble Lords may also be aware that the European Court is shortly expected to give judgments on a group of very important cases on insurance and co-insurance. We hope that the court's judgment will clearly establish the principle of freedom to provide services in this sector. This would give the best possible impetus to renewed work on the draft directive, which we hope to begin before the end of our presidency. I hope that this is the kind of indication of the way in which we see the opportunities for business, particularly in services where we as a country are strong in this larger internal market.
Finally, I turn to Article 70(1), which is covered by Amendment No. 12, under which unanimity is currently required for directives aimed at liberalising the movement of capital between member states and third countries. Liberalisation of such movements has to take place in step with liberalisation of capital movements within the Community, since otherwise you could sidestep one member state's restrictions on capital movements to third countries by channelling capital through another member state (such as the United Kingdom) which does not impose such restrictions. Liberalisation of capital movements involving third countries is thus essential if a free capital market inside the Community is to be achieved. Such a market is in turn essential if we are to achieve a free market in financial services. I need hardly remind the Committee that a free European market in financial services would represent a major opportunity for British business, and in particular for the City of London.
The change brought about by the Single European Act should bring this day nearer by making it easier to adopt measures aimed at liberalisation, while leaving the existing position unchanged for measures which represent a step away from liberalisation. Member states will of course continue to be able to invoke the provisions of Article 73, which allow for protective measures in certain circumstances where capital movements lead to disturbances in the functioning of a member state's capital market.
Article 16 would also extend qualified majority voting to the formulation of Community policies for sea and air transport, in line with the existing voting requirements for inland transport in Article 75 of the treaty. It is no accident that Community policies on inland transport, and in particular the progressive liberalisation of road haulage, are relatively well developed, while common policies on aviation and shipping, which are just as desperately needed, are still the subject of difficult negotiations. The introduction of majority voting should help put right this imbalance.
I have gone into this in some detail, but these amendments are important. The issues raised are important, and I wished to give a full response to the

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detailed points which have been raised. We believe that these are areas in which the introduction of majority voting should make it easier for us to achieve the Community policies for which the United Kingdom has consistently argued, and in particular should bring closer the day when we have a genuine common market in Europe—the name by which the Community is so widely known in this country but which is not in fact true in Europe.
Lord Bruce of Donington: I am most grateful to the noble Baroness for her reply. I should be glad if she could inform me whether, in pursuit of Article 16, she has had a chance to see the proposal for a Council directive amending, for the third time, the first Council directive for the implementation of Article 67 of the EC concerning the liberalisation of capital movements. Can the noble Baroness give some indication to the Committee which way Her Majesty's Government's representatives voted when this was presented to the Council? The noble Baroness will be unable to obtain the detailed text and certainly to examine it in the course of the debate this evening. However, we are, after all, seeking information and I should particularly like to know just what the Government's attitude was to this directive, which is "COM (86) 326 final of llth June".
The report that appeared in the Financial Times on 17th June was that the Commission exchange control aims were welcomed by the Council in that they concerned all remaining capital restrictions on the import and export of capital from inside and outside Europe. Was that welcome shared by Her Majesty's Government? If so, in the light of the events which have occurred during the past week and during this week and which may possibly resume once the party conferences are over, will they still welcome the enactment or the approval of the proposal COM (86) 326 final to which I have referred?
The Committee will recall that I indicated I was discussing Amendments Nos. 10, 11, 12, 13 and 17 together. May I ask the noble Baroness before we part from this whether she will pass some observation on the provisions of Article 17, which deals with the harmonisation of indirect taxation? While she is commenting upon the Government's attitude towards Article 17, no doubt after mature consideration, perhaps she would on this occasion give me the answer to a question that I posed to her when we were discussing a previous amendment. I asked for the Government's attitude towards the case brought by the Commission against Her Majesty's Government, requiring them to levy a 15 per cent. VAT upon new buildings. She did not reply to that point at the time, doubtless because she was refreshing her memory from the Officials Box. But since the harmonisation of excise duties and indirect taxation is comprised in the provisions of Article 17, she might find in passing the comment on Article 17 which I now have formally to request that she can also make an observation on the VAT position.
The Committee will recall that Article 20, which is incorporated in Amendment No. 17, was also within the grouping which was dealt with. However, in the interests of brevity I passed no individual comment on Amendment No. 17. I should be glad to have the
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comments of the noble Baroness on Amendment No. 17, which, as she will realise, refers to co-operation in economic and monetary policy and makes certain very important provisions. Those, as the Committee will know, will now be formally incorporated in a treaty and, owing to the operation and the way in which the ratification has taken place, will be incorporated into British law. I should like some comments from her as to the effect Her Majesty's Government expect as a result of the application to the United Kingdom of Article 20, the measures dealing with co-operation on economic and monetary policy.
I trust that a suitable degree of caution will prevail; the same degree of caution which led the noble Lord, Lord Bruce-Gardyne, and myself to refrain from making any observation on the economic and monetary situation when the House resumed on Monday. Perhaps a little caution may be required here, but one would like to be informed as to what advantages Her Majesty's Government expect from the incorporation of Article 20.
Baroness Young: I shall do my best to answer all the specific points that the noble Lord, Lord Bruce of Donington, has raised. I shall write to him about the first point, because it is something which I think even he will accept is somewhat wide of the amendments on the Marshalled List. I shall let him have a note on it.
On Amendment No. 13, the question of tax harmonisation, the new Article 99 is not a commitment to tax harmonisation: it provides only for harmonisation to the extent necessary to complete the internal market by 1992. It is more restrictive than the old Article 99 which provided for tax harmonisation "in the interest of the Common Market". It is of course for discussion how far, if at all, the present differences in tax rates between the member states need to be reduced in order to complete the internal market but nobody can force us to change our tax rates. Such decisions remain with the Chancellor of the Exchequer and any change to the existing Community rules would require unanimity.
On the point about VAT zero rating in this country, which I think the noble Lord also raised, this is unaffected by the changes to Article 99. Zero rates are expressly provided for under an existing directive which could only be changed with the agreement of the United Kingdom.
11 p.m.
Lord Bruce of Donington: I am sorry to interrupt the noble Baroness, but will she give a government undertaking that the zero rating on food will be maintained?
Baroness Young: If I can continue with this, the Commission is currently challenging the United Kingdom's interpretation of a provision of the second VAT directive which permits zero rating for "clearly defined social reasons and for the benefit of the final consumer". The Commission is only challenging our zero rates to the extent that they do not clearly fall into this category. The vast bulk of items currently zero rated—that is, food, children's clothes and supplies of gas and electricty to the final consumer—are not affected. We are fighting the case vigorously in the European Court but I must stress that it predates the

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new Article 99 and is not in any way affected by it. I hope that that counts as the kind of assurance which the noble Lord wishes to have.
The final point to which I was going to turn was Amendment No. 17 which is grouped in this. The amendment to the European Community Treaty contained in the new Article 102A merely refers to the existing EMS arrangements. Member states already have an obligation to co-ordinate their economic policies. That is under Article 105(1) of the European Community. The Commission already has a right under Article 235 to make proposals in the monetary sphere. The regulations setting up the European Monetary Co-operation Fund and establishing the ecu were adopted under Article 235 and the reference in the Single European Act to co-operation between member states in this area is to co-operation in accordance with the objectives of Article 104 of the existing treaty so that it contained no new obligations.
The Single European Act stipulates that any institutional developments in the field of economic and monetary policy would be governed by Article 236—that is to say, they would have to be agreed by all member states and approved by their national parliaments.
The amendment would change the substance of the Single European Act as agreed by the heads of government and signed by all member states and would make it impossible for the United Kingdom to ratify the treaty. That I hope covers the point which is raised by Amendment No. 17. I hope therefore that I have covered in my remarks the four amendments which the noble Lord, Lord Bruce of Donington, moved. They are important ones. I hope I have given him the answers to all the points that he has raised and I have indicated to him that I shall write to him on the one point which I have not answered, and I hope that, in these circumstances, he will feel able to withdraw his amendments.
Lord Bruce of Donington: I am most grateful for the noble Baroness's reply. I take it that when the noble Baroness writes to me on the matters—something which she has been so kind as to undertake to do—she will at the same time place a copy in the Library so that it will be available for general consideration.
I would have brought the Committee to a vote on Amendment No. 12, dealing with this "ratchet" paragraph of Article 16, which I regard as wholly objectionable. However, I am advised verbally—and it is confirmed visually—that I would be most unlikely to carry a majority of your Lordships with me in voting for this amendment, which I deem to have a dangerous ratchet effect, to be inserted in any Bill. All I can do, therefore, is to warn your Lordships that the time may come when you will regret not having sent this particular part of a clause back to another place for reconsideration.
I can say no more. I regret being a Jeremiah in this matter but I have had some experience of matters of this kind. Having said that, and with as good a grace as I can muster, I ask the leave of your Lordships to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 11, 12 and 13 not moved.]
Lord Bruce of Doningtonmoved Amendment No. 14:
Page 3, line 13, after ("Communities)"), insert ("but not Article 18 thereof").
The noble Lord said: I beg leave to move this amendment, which deals with the application of Article 18 and supplements Article 100 by Article 100A. Article 18 says:
"By way of derogation from Article 100"—
and I propose to read that to your Lordships because I think there will be merit in studying this in the passage of time, when events have caught up with us, as eventually they will. Article 100 deals with the approximation of laws. It reads:
"The Council shall, acting unanimously on a proposal from the Commission, issue directives for the approximation of such provisions laid down by law, regulation or administrative action in Member States as directly affect the establishment or functioning of the common market.
"The Assembly and the Economic and Social Committee shall be consulted in the case of directives whose implementation would, in one or more Member States, involve the amendment of legislation."
Having referred to the amendment of legislation, and in the absence of the noble and learned Lord, Lord Edmund-Davies, I invite your Lordships to pay attention to the report in Hansard tomorrow of what he said about the amendment of legislation as affecting the United Kingdom.
Article 18 provides that there shall be added two clauses to those which I have already read to your Lordships. These read as follows:
"By way of derogation from Article 100 and save where otherwise provided in this Treaty, the following provisions shall apply for the achievement of the objectives set out in Article 8A."
Your Lordships will recall that Article 8A, as amended, made certain stipulations for the development of the internal market.
"The Council shall, acting by a qualified majority on a proposal from the Commission in co-operation with the European Parliament and after consulting the Economic and Social Committee, adopt the measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market.
"2. Paragraph 1 shall not apply to fiscal provisions, to those relating to the free movement of persons nor to those relating to the rights and interests of employed persons."
Perhaps I may pause there for a moment and say to the noble Baroness, so that she may make a note of it, that I should be grateful for the Government's interpretation and definition of the term "fiscal provisions". I should like to know what the Government understand by those words, as they appear in paragraph 2 of this new Article 100A. For the moment I will continue reading the new article. It reads:
"3. The Commission in its proposals envisions that paragraph 1 concerning health, safety, environmental protection and consumer protection, will take as a base a high level of protection.
4. If, after the adoption of a harmonisation measure by the Council enacted by a qualified majority, a member state deems it necessary to apply national provisions on grounds of major needs referred to in Article 36, or relating to the protection of the environment or the working environment, it shall notify the Commission of these provisions.
"The Commission shall confirm the provisions involved after having verified that they are not a means of arbitrary discrimination or a disguised restriction on trade between member states."
I would then draw to the noble Baroness's attention

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the next paragraph, to which I and, I think, Members of this Committee will attach some importance.
"By way of derogation from the procedure laid down in Articles 169 and 170, the Commission or any member state may bring the matter directly before the Court of Justice if it considers that another member state is making improper use of powers provided for in this Article."
In its present form, that gives sanction for the type of action to which we have referred many times today. We must remember that these will be applicable in British law as well as elsewhere. This is exactly the kind of provision which begins to derogate from the national sovereignty of our country.
Then, at paragraph 5, we read:
"The harmonisation measures referred to above shall, in appropriate cases, include a safeguard clause authorising the member state to take, for one or more of the non-economic reasons referred to in Article 36, provisional measures subject to a Community control procedure."
These are the derogation procedures. I should like more detailed information from the Government as to how they see the application of the particular clause to which I have referred.
Article 19, which is taken at the same time as Article 18, being another amendment, deals with the requirement which is put into law for the Commission to make an inventory of national laws, regulations and administrative provisions which fall under the particular section dealt with in the previous amendment and which have not been harmonised pursuant to that article. It then states:
"The Council, acting in accordance with the provision of Article 100A, may decide that the provisions in force in a member state must be recognised as being equivalent to those applied to other member states."
May I repeat the words,
"member state must be recognised as being equivalent to those applied by another member state",
because I should like the Government's interpretation of them. What is behind what, for the moment, I regard as civil servant's gobbledegook? I should like some indication as to exactly what is meant.
Paragraph 3 of Article 100B then states:
"The Commission shall draw up the inventory referred to in the first subparagraph of paragraph 1 and it shall submit appropriate proposals in good time to allow the Council to act before the end of 1992."
There we are with an approximation of the laws which were reviewed by this Chamber back in 1978–79. I have the report here. Since the reports of Select Committees of this Chamber have been read in admonition of me, I should like to draw the Committee's attention to what the Select Committee said at paragraph 7 of section 22 of House of Lords Paper No. 131, 1977–78, dated April 1978. It reads:
"Above all, the Committee wish to draw attention to what they have said in paragraph 15 above" —
that refers to a tendency in the Commission to harmonise for harmonising's sake—
"since the exercise by the Council of the powers given by Article 100 of the Treaty causes an irreversible removal of legislative power from the United Kingdom Parliament".
That is something to which the noble and learned Lord, Lord Denning, referred. The report continues:
"It is essential that the limits of the Article 100 powers should be more strictly defined and that the Government should undertake to keep within them".
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It is a long time ago, but I think that the admonition still stands. What action have the Government taken, in the eight years that have elapsed since this Select Committee report, in honouring the recommendations of the Select Committee? I am quite sure that the Committee would like to know and that the Minister is only too anxious to reply to the satisfaction of the Committee. I beg to move.
Baroness Hooper: The purpose of the amendments which are now before us, introduced by the noble Lord, Lord Bruce, is—and to some extent I am perhaps reiterating what he said—to remove from the scope of the Bill the new Articles 100A and 100B which would be introduced by the Single European Act. My noble friend has already explained the importance which the Government attach to the creation of a genuine internal market because of the benefits which this would bring to Britain. As this Committee will be aware, British business and industry strongly support the line which we have been taking with our Community partners; and I would emphasise this in the light of some of the comments that have been made to the contrary.
My noble friend also explained the reasons why we, along with the other member states, believe that some extension of the scope for majority voting will make it easier for the Community to take the decisions which have to be taken if we are to achieve the internal market by 1992. The new Article 100A has a very important part in all this. It should lead to faster progress across a wide range of detailed internal market issues. At the same time, as my noble friend explained during our debate on Second Reading of the Bill, we have retained explicit exclusions and safeguards in areas of particular importance for national policy, such as taxation, the free movement of individuals, the rights and interests of employed persons and questions of health.
The second of the amendments before us, Amendment No. 15, refers specifically to the third paragraph of the new Article 100A, under which the Commission is to have its proposals concerning health, safety, environmental protection or consumer protection on a high level of protection. The purpose of this provision is to ensure that where high national standards already exist in these areas, as they do in the United Kingdom, these are not compromised by the doctrine of lower harmonised standards. For example, in the area of animal health we require high national standards not only because they are desirable in themselves but also because our animals are both protected from some diseases by our island position and, at the same time, are more vulnerable to them through lack of previous exposure. The Single European Act thus gives us double protection; first, because the Commission is required to take a high level of protection as its starting point; and, secondly, because we can preserve our high national standards under the special safeguard procedure laid down in the fourth paragraph of Article 108.
The third amendment before us, Amendment No. 16, refers to the new Article 100B. This provision is intended to ensure that as 1992 approaches the Community takes careful stock of what still needs to be done to complete the internal market in areas

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falling within Article 100A. Given the openness of our market the United Kingdom is likely to have more to gain and less to hide from this inventory than most other member states. It will be very much in our interests that any remaining obstacles to the creation of the internal market should be clearly shown up.
It will then be up to the Council to decide how far it wishes to act on the Commission's inventory. Where it decides to act, it will be able to do so either in accordance with the normal practice under the existing treaty rules or by way of mutual recognition. This does not mean that the Council would decide that the standards in any one member state should be adopted by everybody else but it would enable the Council to decide that member states should give mutual recognition to each other's national standards in particular areas in order to allow the free circulation of goods.
We have discussed the Single European Act's provisions on the internal market at length and in some detail. As my noble friend said earlier, a genuine Common Market was one of the main things we hoped to achieve when we joined the Community. We now have for the first time a firm and clear commitment on the part of all member states to achieve this goal together with a firm target date and a set of procedures to speed up the necessary decisions. This is not just good for the Community, as my noble friend has already said; it is good for Britain. Therefore we hope that these amendments will be withdrawn.
I have noted the specific and detailed questions raised by the noble Lord. Perhaps he will forgive me if at this late hour I undertake to write with the detailed definitions that he requested.
Lord Bruce of Donington: I am most grateful for the reply given by the noble Baroness. She will understand that it by no means satisfies me but I note that she is going to make further inquiries concerning specific points that I raised. On the basis that I shall receive replies by letter to the outstanding points that I have made, and that the letter will be placed at the same time in the Library, I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 15, 16 and 17 not moved.]
Lord Stoddart of Swindonmoved Amendment No. 18:
Page 3, line 13, after ("Communities)"), insert ("but not Articles 21 and 22 thereof").
The noble Lord said: It may be for the convenience of the Committee if together with this amendment we take Amendment No. 19. These are in the nature of probing amendments. I do not understand what the Single European Act is getting at in this respect. I hope we shall have some information from the noble Baroness when she replies. The existing Article 118 states:
"Without prejudice to the other provisions of this Treaty and in conformity with its general objectives, the Commission shall have the task of promoting close co-operation between Member States in the social field, particularly in matters relating to: employment; labour law and working conditions; basic and advanced vocational training; social security; prevention of occupational accidents and
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diseases; occupational hygiene; the right of association, and collective bargaining between employers and workers.
"To this end, the Commission shall act in close contact with Member States by making studies, delivering opinions and arranging consultations both on problems arising at national level and on those of concern to international organisations.
"Before delivering the opinions provided for in this Article, the Commission shall consult the Economic and Social Committee."
I do not know how far Article 118 has been complied with. Workers at GCHQ might think that we have not complied with the provision which relates to,
"the right of association, and collective bargaining between employers and workers".
Have we, in fact, complied with that? Article 21 seems to go considerably further. Indeed, on the face of it the provisions might be welcomed. They state:
"Member States shall pay particular attention to encouraging improvements, especially in the working environment, as regards the health and safety of workers, and shall set as their objective the harmonisation of conditions in this area, while maintaining the improvements made.
"In order to help achieve the objective laid down in the first paragraph the Council, acting by a qualified majority on a proposal from the Commission, in co-operation with the European Parliament and after consulting the Economic and Social Committee, shall adopt, by means of directives, minimum requirements for gradual implementation, having regard to the conditions and technical rules obtaining in each of the Member States."
What on earth does that paragraph mean? Does it mean that the Government of this country will now be obliged to set standards in this regard by majority vote of other countries within the EC? If so, and it can be done not by unanimity but by qualified majority, is it not the case that other countries—not our own Parliament, but other countries in the EC acting with the European Parliament—will be able to impose financial burdens on this country to which our own Parliament has not agreed? That is the worrying point. Here again the control of the British Government, even over internal expenditure, will now be qualified by other countries whose backgrounds and whose history in these matters may be completely different from ours. In fact, our own Parliament could have imposed upon it expenditure for which they would have to tax but over which they would have no control. I hope Members of the Committee understand what I am getting at because the objectives of these articles are not in dispute. It is the effect of them that worries me. Certainly it says:
"Such directives shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings."
But how is that to be achieved? Is it to be achieved by saying: "Oh yes, certain firms with more than a given number of employees must impose these conditions, but others may not? Or shall we be told, by qualified majority, that the British Government's ideas on this are not acceptable and that all firms shall be subject to the new regulations, whatever they may be? Is that going to be acceptable to Her Majesty's Government? That may be acceptable to me; it may be acceptable to the Opposition; it may very well be acceptable to the Liberal and SDP Benches; but I think even they would agree that such an imposition may not be acceptable to the Government, bearing in mind their record in the social and employment fields. So it would be useful to have the view and the explanation of the noble Baroness on Article No. 21. Of course, paragraph 3 of that article says:

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"The provisions adopted pursuant to this Article shall not prevent any Member State from maintaining or introducing more stringent measures for the protection of working conditions compatible with this Treaty."
I for one am very pleased about that. Whether the Government will act upon that, I do not know.
Then we come to Article 22:
"The EEC Treaty shall be supplemented by the following provision: 'Article 118B. The Commission shall endeavour to develop the dialogue between management and labour at European level, which could, if the two sides consider it desirable, lead to relations based on agreement.' "
I have thought about that deep and hard, but I do not know what that means. I think the House is entitled to have a full explanation of what it means. Does it mean, for example, that the Commission is going to develop a labour relations policy? Is the Commission going to be able to intervene in matters of trade union rights, for example? It could mean that. I do not know. It seems obscure to me.
Before I speculate any further about what it could mean, and what further powers this could give to the Commission acting on its own, not in concert with the Council, what could the Commission do and what would be the intention under Article 22? I hope that the noble Baroness will be able to give me some explanation, will indeed satisfy me that Articles 21 and 22 are innocuous and that I need not worry about them, and that your Lordships need not worry about them.
Baroness Young: I hope that I shall be able to satisfy the noble Lord, Lord Stoddart. The new Articles 118A and 118B are intended to make further provision than exists in the present treaties for certain aspects of what may broadly be described as social policy. Therefore I think that they are the sort olobjectives that he himself would accept.
First of all, let me explain Article 118A. This recognises the importance of health and safety at work and the need to improve the working environment, and therefore it introduces majority voting for setting minimum standards. The United Kingdom standards in this area are already among the highest in Europe, and the main effect of this new provision is therefore likely to be a gradual improvement in minimum standards elsewhere in the Community. I was somewhat surprised by some of the remarks made by the noble Lord, because what he appeared to be saying was that these articles could lead to higher minimum health standards for working people—
Lord Stoddart of Swindon: I am sorry, but can the noble Baroness repeat that remark? I did not hear it.
Baroness Young: I shall repeat it. What the noble Lord appeared to be saying was that these articles could lead to higher minimum health standards for working people, but they are to be resisted because the application of such standards could cost money. I must remember that argument.
Lord Stoddart of Swindon: May I correct the noble Baroness? What I think I was saying was that that would be acceptable to me but I wondered whether it
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would be acceptable to the Government, bearing in mind the financial restrictions and restraints that they have imposed over the past eight years.
Baroness Young: As the noble Lord will be aware, we have accepted the amendments which have been proposed in the Single European Act and the consequences that flow from it. The Government have helped in a wholly practical way through the Single European Act to contribute to the raising of these various standards that are involved in health and safety at work. As I said, our standards are already among some of the highest in Europe, and the effect of this new provision is likely to be a gradual improvement in minimum standards elsewhere in the Community.
However, we put in a proviso which is included in the third paragraph. We were concerned to ensure that legislation in this area should not hold back the creation and development of small and medium-sized firms because of their important role in promoting innovation, growth and the creation of jobs. We therefore secured a provision to ensure that this would not happen.
As regards the second article, Article 118B, this represents an exhortation to greater dialogue between the social partners, that is to say, between management and unions. Of course, neither management nor labour can be compelled to enter into dialogue, still less to sign agreements based on it. The only obligation created by the article is placed on the Commission; namely, to endeavour to develop dialogue. This seems to me to be something which the noble Lord, Lord Stoddart, would like to see and therefore I hope very much that he will withdraw his amendments to enable these proposals to be included in the Single European Act and be carried out.
Lord Bruce of Donington: I shall not detain the noble Baroness for very long. I am just a little puzzled about one aspect of Article 118A, which is the proviso which she herself has already mentioned; namely, that such direction shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings.
To the uninitiated that would seem to imply that there will be two kinds of standards: one kind of standard for the very large undertaking and another kind of standard for the small and medium-sized undertaking. The noble Baroness must concede that the inference behind this is that if those standards of health and safety which are regarded as normal and which are fixed by law in regard to large undertakings (and which are presumably effective, otherwise they would not be legislated for) are too expensive—because this is what we are really talking about—when applied to small and medium-sized undertakings, then they shall somehow be relaxed. There does not otherwise seem to be any point in putting in the provision. Will the noble Baroness explain that?
It seems that there will be two standards. I presume that there will be a high standard for a large undertaking, but if the requirement imposes too great

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an administrative, financial or other constraint on a small or medium-sized business presumably the standards will be relaxed. That is the only reasonable inference. Will the noble Baroness explain that?
Under Article 118B the noble Baroness talks about the dialogue between management and labour. How do the Government envisage that taking place? What initiative will the Government take to see that that happens; or is the initiative, as always in these matters, to be left entirely to a Commission proposal? I ask the questions with a degree of scepticism following the unfavourable reaction in this place many years ago to the Bullock Report, which advocated a degree of worker participation which the CBI did not find entirely agreeable. Will the noble Baroness explain a little more what she means by dialogue? We are all human. Whether we are workers or management, we shall always talk to one another. Every time that we talk to someone there is presumably a dialogue.
Baroness Young: I shall do my best to clarify the points raised by the noble Lord, Lord Bruce of Donington. He asked me what was meant by the second part of paragraph 2 of Article 118A:
"which would hold back the creation and development of small and medium-sized undertakings".
As I understand the position, that paragraph will not affect minimum standards. I am sure that the noble Lord is aware that some small businesses which are starting may have minimum standards, whereas they may not have the standards of health and safety at work which might be expected in a larger well-established firm. We do not want anything which would prevent the creation of new jobs and the industrial base for which the noble Lord has been asking and which we all want to see.
Under Article 118A we should have improved health and safety at work standards. We have secured the provision that all the arrangements would not necessarily apply to small and medium-sized firms because of their important role in promoting new investment and growth.
The noble Lord asked me what we mean by dialogue. As I understand it, dialogue is already taking
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place. The TUC is involved and it is having talks with some managements. My right honourable friend the Paymaster General will be meeting the social partners shortly and will be discussing these matters.
I do not think that the noble Lord need feel that there is anything unusual or extraordinary about this matter. It is the kind of thing which I should have thought would have been welcomed by him and his colleagues. I hope therefore that with those explanations he will feel able to withdraw his amendments.
Lord Stoddart of Swindon: I shall not keep the Committee much longer. I am, however, still intrigued by Article 118B. Obviously, dialogue between the two sides of industry is to be welcomed. I certainly welcome it. Indeed, we on this side have been asking the Government to have better dialogue with the trade unions in this country. Unfortunately, they have not seen fit to take our advice. It is too late to go into the matter this evening. But it is quite intriguing. I do not know how this dialogue is to take place. I shall withdraw the amendment but, because I am so intrigued, I may want to probe the matter further at Report stage. I hope therefore that the noble Baroness will not mind if I put down another amendment on Report. With that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 19 not moved.]
Baroness Young: In view of the lateness of the hour, and as we have reached a part of the Bill where it would be right perhaps to conclude our proceedings for this evening, I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at fourteen minutes before midnight.