First Day

Part of Debate on the Address – in the House of Commons at 6:44 pm on 6th May 1992.

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Photo of Michael Spicer Michael Spicer Chair, Parliamentary Office of Science and Technology 6:44 pm, 6th May 1992

That is right. My hon. Friend's last point about the interpretation of the last treaty is what counts. It is the treaty that we have to go on. We cannot go on blandishments, hope, and so on. My hon. Friend is absolutely right that we must judge the thing on its merits and on the interpretation that we think that lawyers will place on the treaty in future days.

My second and more fundamental anxiety is about the concept of a single currency. I appreciate that it is difficult to make a popular issue out of the words "single currency". But the reason why it is of importance both to those who want a federal Europe, including some of my hon. Friends who have spoken today, and to those who are worried about it is that a single currency will necessitate a single economic authority to manage all aspects of the currency, including the fiscal, taxation, expenditure and monetary policies that go with it. It is not merely a question of the convenience of abolishing exchange offices where business men exchange money. It is a fundamental point.

If there is a single currency, there must be a single economic authority and a single economic policy. Throughout history, economic policy has gone to the centre of sovereignty. Civil wars have been fought about taxation policy and monetary policy. That is effectively what government is all about. It is about the taxation and the distribution of resources. If a country gives those powers away to some other power, it has given away the very essence and core of its sovereignty.

The single currency is the written-in objective of the Maastricht treaty. It is even worse when one considers that we are not only setting up an entirely new set of bodies to manage the currency but giving its control to a central bank mechanism which is independent of politicians and the people who represent society. Therefore, there is a double whammy, to use the phrase which loomed large in the general election.

The question is whether the treaty of Maastricht moves in that direction. There is the argument that we have given ourselves the possibility to opt out. There is the point that countries must converge under the current terms of the treaty, terms that are alterable or can be fiddled. The Italians have already said that they would fiddle their convergence conditions. The fundamental question remains: are we, by signing the treaty, inexorably moving towards a single currency or not? That is the question that I must ask myself.

When we come to sign a treaty which sets up institutions—in stage 2 we have pretty well reached the point when we shall set up a European monetary institute, the precursor of a single, economic, banking authority, which will undoubtedly exist whatever the opt-out clauses —we are on an escalator off which it will be difficult to climb. Once we have the institutions, they will have a certain permanency, certainly if they are included in a signed treaty. There will be a self-fulfilling element. They will be magnets drawing us ultimately to a single economy and, thus, a federal Europe. I cannot in any circumstances conceive of a single economic authority without a federal structure with it—a Parliament and all the other trappings of a federal centralised Government.

The treaty of Maastricht is of enormous importance. It is an absolutely fundamental step in the direction of a federal Europe. It is an irrevocable step—and that word is used throughout the treaty. It will be impossible to reverse it. Therefore, the House will hear a great deal more from me—if I catch your eye, Mr. Deputy Speaker, or that of your colleagues—as we approach this historic step. There is no way it can be fudged. We must take a view either one way or the other. I am extremely concerned at what I have read in the treaty, and I hope to express my concern in the weeks ahead.