Mr Major’s Commons Statement on the 1993 European Council in Copenhagen – 23 June 1993

Below is the text of Mr Major’s Commons statement, made on 23rd June 1993, on the 1993 European Council which had been held in Copenhagen.

PRIME MINISTER:

The Prime Minister (Mr. John Major): With permission, Madam Speaker. I will make a statement about the European Council in Copenhagen, which I attended with my right hon. Friend the Foreign Secretary. The principal issue before the Council was how to promote economic growth throughout the Community. Although Britain is now emerging from recession, a number of European countries are still seeing their economies shrink– five are expected to be in recession during this year. Unemployment has grown throughout the Community and now totals 18 million–in most countries it is still rising, and in some it is rising quite sharply. Against that background, the President of the Commission presented options for economic revival in the medium term. That document has been placed in the Library of the House, together with the conclusions of the Council.

I largely agreed with the diagnosis set out by the President of the Commission, although not with all his proposed remedies. In the subsequent debate, I was encouraged by the wide recognition that the Community had to improve Europe’s overall competitive position and to address the trend of rising unemployment throughout all of the past 20 years.

The Council agreed a number of practical measures to improve Europe’s economic prospects. We stressed the importance of low inflation, specifically in order to improve cost competitiveness and achieve sustainable growth; we reaffirmed the priority given at the Edinburgh Council in December to growth and investment in our public expenditure programmes; we decided to expand the temporary lending facility of the European Investment Bank from 5 billion to 8 billion ecu, with a particular emphasis on helping small and medium-sized companies; we agreed that it was vital to reduce fiscal deficits–without that, much of Europe will not be in a position to reduce its interest rates.

The argument that the Community had to keep down costs in order to improve competitiveness and create new jobs was widely supported at the Council. It was felt that, unless that was achieved, we would find ourselves increasingly uncompetitive against, not only the Pacific countries, but also our primary competitors in the United States and Japan. It was also recognised that all Europe, without exception, had to face the problem of the rising costs of social provision, brought about by demographic and other changes. The European Commission has been invited to present a White Paper on a medium-term strategy for growth, competitiveness and employment for discussion at the European Council in December. Member states will be submitting proposals for the White Paper. I believe that that will enable the Community to build on the European Council’s new emphasis on competitiveness. Over the next six months, we shall press for reforms to increase flexibility in the labour markets and reduce unemployment. I hope that that will lead to a genuinely radical report at the December Council.

Following earlier Council discussions of subsidiarity, the European Commission has now produced a first list of items on which it has decided not to propose legislation. I will place that list in the Library. At the next Council, the Commission will produce a further list, showing existing legislation that will be either repealed or amended. Subsidiarity was a controversial provision in the Maastricht treaty some time ago, but we now have strong support for our position from a number of member states. Subsidiarity is becoming a central element in the Community’s decision making.

There was a substantial discussion of the Community’s external policy. I would draw attention to only four specific items. First was the importance of urgent progress in the Uruguay round. I am in no doubt that a general agreement on tariffs and trade will benefit all Community members without exception, but there is a long way to go in a short time if a satisfactory agreement is to be reached during this calendar year.

Secondly, the Council was keen to see rapid progress in the enlargement negotiations with Austria, Finland, Norway and Sweden. We set 1 January 1995 as the target date for their entry–earlier than previously expected. Their membership, in my judgment, will strengthen the Community.

Thirdly, looking to the longer term, the Council agreed that the six associated countries of central and eastern Europe should be invited to join the Community in due course. It will, of course, take some time until they are ready. In the meantime, we will help them by increasing the Community’s political links and by opening our markets more rapidly to their goods. A package to that effect was agreed. Fourthly, the Council acknowledged the need to recognise Russia’s international status, and agreed to my proposal to offer summits between the Community and Russia twice a year.

The deteriorating situation in Bosnia was discussed both by Foreign Ministers and by Heads of Government. Those discussions included the possibility of lifting the arms embargo. We agreed that the Community should encourage the efforts of Lord Owen and Mr. Stoltenberg to promote a fair and viable settlement. This view was widely shared, and is reflected in the Council’s declaration on Bosnia-Herzegovina. I argued that lifting the arms embargo would jeopardise the humanitarian operation and provoke a bloodier and perhaps wider war, with perilous consequences. We agreed after discussion that it was better to seek a peaceful settlement acceptable to all sides. But, as the Council made clear, this cannot be a solution dictated by the Serbs and Croats and at the expense of the Muslims.

The Council also agreed that the Community should support the efforts of the United Nations Secretary-General to secure additional troops and funds to implement the safe areas resolution. The United Kingdom is, of course, as the House is well aware, already making a full contribution.

This was a practical Council. It addressed directly the concerns of the peoples both east and west. It put in hand work on a new economic approach to make Europe more competitive and increase growth and employment. We will return to those matters at Brussels in December.