European Union

Part of the debate – in the House of Commons at 9:18 pm on 11 December 1996.

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Photo of Sir Ray Whitney Sir Ray Whitney , Wycombe 9:18, 11 December 1996

The speech of the hon. Member for Newham, North-East (Mr. Timms) underlines the reality demonstrated by this debate—that there is, across the House, strong support for a positive and constructive relationship with Europe and for maintaining our option to enter or stay out of a single currency. Clearly, the Labour and Conservative parties have sizeable minorities who are hostile to Europe. We have seen a document signed by 50 Labour Members of Parliament who express that opinion, and I imagine that a similar number of Conservative Members share their views. But they are not the majority, and they have been made to appear so by the press—about which so much has been heard in this debate, and rightly so.

We are halfway through this important debate—which I greatly welcome—and its value has been demonstrated. The real voice of the House of Commons needs to be heard above the xenophobia and paranoia to which we have grown accustomed over the past two or three years. We have now been able to see a little of what the Euro-sceptics actually believe in. In my view, scepticism is not a genuine political position—one must believe in something.

We have seen a series of contradictions from the sceptics on both sides of the House. They believe, for example, that a single currency will not work and that it is a leaky ship. They think that it will be a disaster, and they may well be right. As my right hon. and learned Friend the Chancellor has pointed out, it could conceivably turn out as they say. I think that that is unlikely, for reasons on which I shall touch in a moment. But those who say that this is a hopeless cause, a leaky ship and a dreadful mechanism that will impose terrible and insupportable burdens on our economy and will make us pay money that we do not have cannot have it both ways.

The sceptics in my party cannot claim to be good Conservatives, and I speak as someone with dry, right-wing credentials—that is, I believe in good housekeeping and all the other good monetary disciplines that are, to a degree, enshrined in the Maastricht criteria. I do not believe that any country can devalue its way into prosperity, and experience over the last generation has demonstrated that. Yet my hon. Friends—who, in months and years gone by, seemed to share those views—now reject them because the views have been embraced by the nasty, suspicious and scheming continentals. It does not negate the sanctity of those principles if other people have now discovered—albeit belatedly—that they are good ideas.

Frequently, the German bogey is brought out of the box. The fear is that, having failed in two world wars, this is the way in which the Germans will achieve domination over western Europe to start with and eastern Europe the day after tomorrow. Oddly enough, the German people seem unconvinced of that and, at the moment, the majority of German people are deeply suspicious. Some 60 per cent. or 70 per cent.—depending on which opinion poll one believes—have yet to be convinced by their political leaders that joining a single currency is a good idea. If I were a German who had worked hard for 45 or 50 years to maintain and develop a stable and strong economy and a stable and strong deutschmark, I would take a lot of convincing that I should launch the deutschmark into a system with other currencies with less impressive track records.

The Euro-sceptics refuse to face up to many challenges and constantly make negative attacks, but they face a conundrum. What are the other countries up to? Why are seven, eight or nine countries trying every trick in the book—I accept that there are some tricks being played—to get into the single currency?

Those countries live in much closer contiguity to the Germans than we do and they have genuine experience of German domination and understand much more clearly the realities of Germany. But are they stupid? Are they ready to give away their sovereignty, or do they know something that our Euro-sceptics do not know? I suggest that the answer is the latter.

We must also take account of the possibility that those countries are ready to throw away all their achievements, yet the record of many of them over 30 years is better than ours. In 1965, one could get more than DM11 for a pound and now one can get only DM2.30 or DM2.40, or whatever the rate happens to be today. I cannot believe, therefore, that either the Germans or any of the other countries will launch a ship that will sink within a year or two. We shall have to wait and see, but that seems highly unlikely.

The sceptics tell us that our trade opportunities with the rest of the world are wonderful, and I believe that they are, thanks to the Government's stewardship, but we should not forget the balance of trade and the almost 60 per cent. of our trade that is conducted with European Union countries. To put the matter in perspective, we should remind ourselves that our trade with the Netherlands amounts to as much as our trade with the six Asian tigers, China, Indonesia and the Philippines put together, and that our trade with Sweden amounts to as much as our trade with the whole of Latin America.

My right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) suggested that economic success had proved that the United Kingdom could prosper without the single currency, but of course there has not been a single currency. We are dealing with the world as it will be. There is no doubt that, at whatever time and in whatever shape a single currency comes, it will come, so it cuts no ice to suggest that we have done well without it.

My right hon. Friend the Member for Kingston upon Thames also said that he welcomed the opportunity to go it alone in monetary affairs. He had the honour of being Chancellor of the Exchequer. Of all people, surely Chancellors of the Exchequer know that going it alone in monetary affairs is not exactly an option.

On interest rates, it is interesting to note that our borrowing costs are somewhere between £5 billion and £7 billion more than Germany's, because interest rates there are much lower. If we had the German rates, the savings would mean a cut in income tax amounting to £10 a week for the average household. The chances are that a sound single currency will enable us to live with lower interest rates, and we must bear such factors in mind for our constituents' sake.

Some of my hon. Friends say that the majority of people in this country are doubtful and suspicious of the European Union and, more especially, of the single currency. I accept that that is true—it is also true, as I said, in most if not all the countries of the European Union—but it is the job of responsible politicians to lead and educate the electorate and not merely to listen to and follow them.

This debate has demonstrated that, to put it mildly, our minds should he kept open about the beneficial effects of a single currency. It would be a gross dereliction of duty to fail to lead the British people in the paths of common sense simply because Mr. Christopher Booker and the newspaper editors and owners about whom we have heard so much have misled them. I am glad to say that the debate has demonstrated that the majority of right hon. and hon. Members have that common sense, and I hope that we shall hear more of it in the months to come.