HC Deb 08 February 1996 vol 271 cc364-6W
Mr. Llew Smith

To ask the Chancellor of the Exchequer what assessment he has made of(a) the benefits and (b) the disbenefits to the United Kingdom of joining the European monetary union. [12672]

Mr. Kenneth Clarke

At this stage it is not possible to make precise judgments about the benefits and disadvantages of joining a single currency. As my right hon. Friend the Prime Minister has said, we would be operating on hunch rather than facts if we were to make a decision on any assessment now. This is the value of the opt-out. We will only agree to take part in a single currency if it is in our national interest to do so, given the circumstances at the time.

Mr. Mike O'Brien

To ask the Chancellor of the Exchequer, (1) pursuant to his statement in European Standing Committee B of 12 December 1995,Official Report, column 3, what are the criteria he will use for assessing whether economic convergence has been arrived at to justify entry into economic and monetary union; [13437]

(2) what are the criteria for the national interest which will be used by the Government to determine a view to recommend to Parliament on whether to opt in or out of economic and monetary union. [13441]

Mrs. Angela Knight

The nominal convergence criteria are set out in the Maastricht treaty. All member states need to concentrate on achieving sustainable recoveries and getting unemployment down. The nominal convergence criteria require Governments to bear down on inflation and reduce fiscal deficits. These policies represent sound economics. As well as the Maastricht criteria, the Government believe that measures to address differences in productivity growth and flexibility of labour markets should also be put in place to help ensure durable convergence. The treaty refers to indicators which reflect these structural differences: trade balances on the current account; the integration of markets; and the development of unit labour costs.

Protocol No. 11, annexed to the EC treaty, means that the United Kingdom shall not be obliged or committed to move to the third stage of economic and monetary union without a separate decision to do so by the Government and Parliament. We will agree to take part in a single currency only if it is in our national interest to do so, given the circumstances at the time. Any decision will be based on a hard-headed assessment of British national interest in terms of jobs, capital investment and ability to sell goods and services in world markets.

Mr. O'Brien

To ask the Chancellor of the Exchequer what have been the costs to Her Majesty's Government of participating in discussions in the European Monetary Institute and at all ministerial and other meetings to discuss economic and monetary union; and if he will list the costs to date and projected costs up to 1999 in each category of expenditure. [13438]

Mrs. Knight

Ministers and officials attend many meetings on economic or monetary affairs, some of which include discussions of economic and monetary union. It is not possible to separate the costs of participating in discussions on EMU.