The Rt. Hon. Sir John Major KG CH

Tag: Maastricht Treaty

Mr Major’s Speech to the Newspaper Society – 1 May 1996

Below is the text of Mr Major’s speech to the Newspaper Society, held in London on Wednesday 1st May 1996.

PRIME MINISTER:

[Small section missing] What we see in our legislation is an environment in which the media thrives and is competitive without creating a monopolistic situation. I have to say to you it is a difficult balance to keep. I believe it is an intensely important balance in the democratic debate, but I don’t pretend to you that it is one that is readily obvious and one that can be achieved without a great deal of discussion and thought. For what we are seeking to do in Cross Media Ownership provisions is to exploit new opportunities and new technologies while ensuring that we protect diversity. Of course we have listened to the representations we have had by the regional press and national press on the subject of ownership, and we will continue to listen to them. We sought to lift controls which restrict the growth of vibrant media companies. All over the United Kingdom, companies, whether national or local, are finding themselves in a more competitive environment than any they have ever faced in the past. We seek to reflect that across a whole range of legislation and to try and find a more favourable environment than ever before for the newspaper industry, and indeed every other industry to operate.

One thing I am sure of, the press expect the government to protect their freedoms, and if I may say so, sometimes under some provocation we have sought to do precisely that – to ensure that the press is free and unfettered to carry out its proper goal in the democratic debate. Not for us the veiled threats that if the press misbehave at the next general election they can expect curbs. Others may make those threats, indeed have done, we certainly don’t. And I think also it is well worth people looking at the commitment to put the European Convention on Human Rights into British Law, because a careful examination of that will show you that the voluntary code on press complaints could be replaced by regulations by courts, were that to be incorporated into domestic law.

Now of course changes in the newspaper industry were essential, are essential, and I have no doubt will continue to be essential in the future because of the competitive market in which you operate. Old jobs, hallowed, dignified by tradition are suddenly overtaken by an entirely new way of doing things. Every day in the House of Commons l face appeals to fear of change, fear of a change, appeals which want to ignore change, that want to stop it and always itches to control it.

I must say to you, I believe that although that may sometimes be good politics in the short-term, it is bad statesmanship. Unless this country actually faces the need for change – unpopular and uncomfortable though it may be for governors and governed alike – unless we actually meet those changes, face those changes and make those changes, we will not provide a business environment for the present, or for the future, in which British industry and commerce can survive and thrive. And I believe we have to make those changes, however difficult they may be.

Labour have a new language these days, the pretentious language of ‘stakeholding’. I have to say to you, and I do not believe I am alone in this, that I am not entirely sure what it means or what it amounts to. It does seem to me to be a retreat into some cosy world of the past, that our future will only be bright if we look at the future, make the changes that are necessary, uncomfortable though they may often be, in order that industry and commerce can seize the opportunities that undoubtedly are there. And that can be done.

Your industry perhaps above all, both nationally and locally, your industry is a classic example of how we embrace change with confidence. What we have seen in the last decade or so is an extraordinary burgeoning of new titles, new media companies, and whole new media industries.

Information, education, communication – they are some of the key watchwords of the future. And we in Britain are uniquely well placed to take advantage of these global changes. The liberalisation of the whole telecommunications industry, the massive asset of the English language – all of this shows why your industry and across the economy as a whole, we can make Britain the Enterprise Centre of Europe, an increasingly effective and efficient force on the international business environment.

We are now, as we meet here today, within a year of a General Election. And I believe as we get closer to that election people will increasingly wish to focus on the substance of the political debate. And I emphasise the substance. The important questions about substance and about policy are really very straight forward. Will it work? Does it make sense? Does it add up? Will we be better off, or worse off, if we take this particular route? How does this policy or that policy actually affect our national interests?

They are the key questions and what we, the politicians, and what you, the media, must ensure is that those issues and principles are properly set out, exposed and challenged as well. Those questions affect our future. They deserve an answer from the politicians, and not just evasions.

But I say “politicians and media” have a responsibility because I believe we both do. And let me explain to you why I say that. We have as sophisticated an electorate in this country as in any country in the world – sophisticated. But even so, these days it is often an uphill struggle to engage in rational detailed debate about contentious issues.

The simple problems are gone. The complex problems remain and they are very difficult. They are very difficult to solve and they are very difficult to report fully and accurately as well. They need background and they need explanation.

We are all familiar with the simplistic headlines. I have even heard there are politicians who talk in sound-bites in the hope that they might possibly become headlines.

But there are two concerns that I would not be surprised if you shared with me. The first is over-simplification of important issues; and the second is too much emphasis on what is wrong and too little acknowledgement of what is right.

I think that one of the great advantages of the written word is the opportunity to explain issues in greater depth. News clips on television and radio are very important, but they can rarely do proper justice to a complex detailed issue. It is impossible to conduct a serious political issue and then interpret it in a simple headline, impossible to address a complex issue in a brief clip on the 6 o’clock news.

Let me paint a thought. I speak for 40 minutes on the intricacies of education and I set out a whole series of detailed policies. On the 5.40 or 6 o’clock television news there will be 1 minute of my speech and probably a contentious bit, 1 minute of my 40 minutes; it will be followed most probably by 1 minute of Mr Blair, who hasn’t read the speech; 1 minute of Mr Ashdown, who hasn’t understood the speech; and a 2 minute explanation by someone of what it was I meant by what it was I said. Of course the Prime Minister was talking about education, but what he meant was that he wanted to distract you from divisions in the party over European policy.

That does not advance the democratic debate very much. And as for documentaries, they tend to follow after the event and are often broadcast at inconvenient times and to small audiences.

But for the written press, national and local, a different set of criteria apply. I believe that the media has a very important duty in the exercise of our essential freedoms, to inform debate upon important issues, to raise public awareness and to inform our society.

There is a problem that I would like to share with you and I hope you will accept that I am seeking to share it with you because I believe it is something that together we need to address.

These days in our complex society with our complex problems, there is a tendency for people and their views to get labelled for ease of recognition. There is a tendency for the arguments to be over-simplified to the extent that they are only reported as if in code. It is left wing, or right wing, it is Europhile or Eurosceptic. We all know the code. I would like to alert everyone to the danger, and the danger is the short-changing of the public of what the true opinions and positions of their politicians are on important matters of national concern.

But let me try and give you an example of what I mean. I believe it is the government’s job, any government, it is their job to weigh up the issues and to take action in what it judges to be the best long term interests of the country. Of course many will disagree with their conclusions, they may disagree, that is part of the debate but it ought not to dictate the agenda and certainly it won’t dictate mine. As Prime Minister I must speak for the national interest as I see it – and I will, whatever the noises off may be and from wherever the noises off may come.

Let me take the European debate for a moment. I believe strongly that Britain can and does benefit from being in Europe. If we were to stand back and contemplate what our position might be had we not been opening up the European market over the last quarter of a century, I think you would begin to see precisely what I mean.

But at the same time, whilst I have not a shred of doubt that we should be in the European Union fighting for the sort of European Union we want, we need to have the confidence to defend our interests and our rights as a nation state within the European Union.

It has many frustrations, but it is in our interest, beyond a doubt, to be a part of it and seek to shape it. It is not in our interests to be on the side of it and leave the shaping of future policy, in whatever sphere it may be – social or monetary – to other people, then leaving us with decisions that they have made with which we have to live. That in my judgment is not a position for a proud, important, independent, democratic nation to find itself in. And that is why I believe we need to be in the centre of the European debate and express our views.

But we are there to express our views and that means we can reject – as I do – any further moves towards political integration in Europe. It is important that a rational common sense European debate does not get obscured by over-simplification for the search for political drama.

I know that in saying what I have just said to you that this view does not neatly fit into those simplistic boxes – Europhobe or Europhile. And because I occasionally make speeches that don’t fit into those simplistic boxes, it is all too easy to claim that what I am saying is just a balancing act with all the indications of compromise that that implies. I bluntly reject that interpretation. I am against communism. I am against fascism. That doesn’t mean I compromise as a Conservative. I am a Conservative because I believe in conservatism, and I take a middle of the road view on European matters because I believe our national interest requires us to be in Europe, not to take an extreme view, anti-European or fanatically pro-European, but to fight my corner in the interests of my country in the European debate.

I don’t think that is a lack of conviction, I think that is an understanding of what is in the interest of the vast majority of people in this country and it is right for me to fight for those and not to be pushed to one edge or another edge of a vitally important debate for this country, and I have no intention of being so.

But if you need to carry out your agenda, whether in Europe or elsewhere, the first ingredient for any government is to produce a stable economy. And I would like to say to you today that I think we have produced a more promising series of economic prospects for this country than we have literally known for generations. I know in the clamour of daily drama this can so easily be overlooked, but let me just set out some of the points to illustrate what I am saying.

As we meet here today for this excellent luncheon, we have the lowest mortgage rates for 30 years; the lowest basic rate of tax for over 50 years; the lowest tax burden of any major European economy; the lowest unemployment of any major European country; the longest period of low inflation for 50 years; we get more foreign investment in this country than any other country in Europe, and almost as much as the rest of Europe put together; our industry exports per person more than Japan or the United States; and we have seen fewer days lost in strikes since records began. And if one turns to social changes: we have invested more in pensions than the rest of Europe added together; and we now have one in three of our young people entering higher education, where it was only one in eight 15 years ago.

I have set out those points. I have to say to you that if I had come to you on the eve of the last general election and said I am going to come back in May 1996 and I will have achieved all those changes, there is not a single journalist or proprietor here who would have believed that that would actually have been achieved. But it has been, and the fact that it has been makes a profound difference to the backdrop of policy for the future and it is the backdrop to the agenda that I will put before the country at the next General Election.

That agenda that I care about is a very down to earth agenda but I think it is a very realistic agenda. It sees the world as it is and it seeks to improve it. It is not pipedream dressed up as rhetoric. It is about trusting people and giving individual choice and opportunity to them, not having it exercised by government, national or local. It is about encouraging enterprise for the simple reason that governments cannot create jobs. We can set a framework in which enterprise can create jobs, but not if we hamstring it in the decisions that it has to make. And so we need to encourage enterprise and let it loose to create jobs, prosperity and security for the future.

There are people who think they are helping jobs by preserving old jobs with artificial legislation. I say they are wrong and what they actually do is inhibit the provision of new jobs that will last and extra efficiency and competitiveness for this country.

I have an agenda about maintaining respect for the rule of law and for ordinary common decency. I believe that up and down this country the people to whom you sell your newspapers, they are decent, straight forward, common sense people and they cry out to see that defended nationally and locally by their politicians and by their opinion formers and I believe that is precisely the business that we should be in.

We need to care for the way that people are treated by the public services. I come from a background where the public services were very important to my family and I learnt at a very young age the arrogance of so much of the public service, the arrogant belief that because it was funded by the taxpayer and provided free at the point of delivery, that one didn’t have the same rights as a consumer of that service that one would have had if you were paying cash on the nail. For I passionately disagree with that. We don’t pay cash on the nail for our public services, we pay cash in advance in taxes, compulsorily extracted from our incomes, in order to provide that public service and we have every right to demand of it the very best service that can be provided.

And I think we need to re-assess and speak more frequently about the pride and respect that our country deserves, about our national institutions and about our values. Those are issues that will be at the core of the next General Election and they are issues upon which I will be comfortable to fight.

One of the most ill-judged criticisms of recent years has been those commentators who have said: “But there is very little difference between the political parties”. Now it is true that a number of parties ape traditional Tory sentiments these days, and they do that because they know that that is what appeals to the innate instinct of the British nation. But the policy issues, the actions that will be carried out in government that would affect you and all the people who read your newspapers, those differences are very real.

And let me tell you the differences I mean. The different approaches to public expenditure, where it is clear that the Opposition would spend far more and where their plans don’t remotely add up to the income they are likely to have. The difference between our philosophical belief as Conservatives in low taxes, and our opponents’ hidden agenda of raising taxes, whether through axing child benefit, taxing company cars, or raising the rate for anyone who earns as much income as Clare Short.

There are different approaches throughout the political agenda, different approaches to employment. My approach is to create jobs through enterprise, not to damage enterprise by adding extra social costs to employers to inhibit their capacity to employ.

The difference between the action that we have taken to improve standards and choice and information in education, and the action all our political opponents have taken, which has been to oppose everything we have done to improve standards, to enlarge choice or to dispense information to parents.

I believe in choice in education. Our children are not all of a kind. We need a rich variety of choice to match the individual needs of our children. And I don’t have a shred of hesitation in saying that that will certainly include an extra element of selection where that is the demand of parents and where that is the wish of school governing bodies.

And then there are differences in our approaches to crime, where we have produced measure after measure and had to force them through the House of Commons against the votes of our opponents time and time again.

And then perhaps, at this moment, the greatest debate of all. The implication of the Opposition’s policies at home and in Europe for the constitution and the stability of the United Kingdom.

Let me turn firstly to the plans for devolution and other constitutional tinkering. I won’t mince my words about that. I believe that if we were to have a tax-raising parliament in Scotland, that we would have taken a giant step towards dismantling the United Kingdom as we see it today. These policies are not thought through. How can it be right for Members of Parliament at a Scottish Parliament to vote upon matters that affect Scotland, and then go down to England and vote upon the same matters affecting England, where English, Welsh and Northern Irish MPs would have no say in what happens in Scotland? How can it be right to leave over-representation in Scotland where they have a tax gathering Assembly? How can it be right for a disproportionate amount of public expenditure to continue to flow to Scotland if they are to have their own tax-gathering Assembly?

And what have the Scots done, what dreadful crime have they committed, that they should be invited to pay at least an extra 3p in the pound in taxation? I have a great affection for the Scots, I listen to them whenever I have the opportunity, and I have never heard them say to me yet: “I would like to pay an extra 3p in the pound in taxation”.

When our opponents say: “We might reduce taxation in Scotland”. Really? Well that would be a novelty, for Labour to reduce taxation anywhere would be a novelty. But for Labour to reduce taxation on the basis of a disproportionate amount of public expenditure coming out of the rest of the United Kingdom would not be possible. The fact is taxes would rise in Scotland and there would be great disunity between Scotland and the United Kingdom.

And what would happen at some stage in the future, and if possible, perhaps probable, that the Separatist Party in Scotland won the elections for the Scottish Assembly? Would not the Scottish Nationalists regard this as a mandate for separation? That is the basis of their programme. Of course they would. And what would be the position between a Scottish Parliament in which a party demanding separation had just got the majority, and an English parliament perhaps peeved and concerned that they were pouring extra expenditure into Scotland? What sort of division and break would come about from those policies?

Now I am not seeking to make a cheap political point. If one wishes to talk politics, we don’t have as many seats as the Labour Party in Scotland by quite a margin, if I wanted to play political advantage I would say let Scotland go, I will be 40 seats to the better if I let Scotland go. But I say no. The United Kingdom would be weaker if it began to break up and we lost Scotland. I would rather have Scotland, even with its extra Labour and Scottish Nationalist seats, than see it divide. We Tories are on a high point of principle with our policy about Scotland and we will try and make sure that this is a central part of the next General Election because a United Kingdom that is divided and broke up would not only mean a weaker Scotland, it would mean a weaker United Kingdom as a whole and it must not be permitted to happen.

And then of course there are divisions in policy between ourselves and our opponents on Europe. I think it is interesting to look not at the divisions within the parties, of course there are divisions within my party and divisions within the Labour Party. Fifty Labour members recently produced a manifesto that was tantamount to saying let us leave the European Union and have nothing whatever to do with it. So there are those divisions across politics, let us enter into serious debate and acknowledge that.

But there are also very substantial differences between the political parties on European policy. The Labour Party would centralise power in Europe. We would not. The Labour Party would accept the social chapter. We would not. Labour would accept more qualified majority voting. We would not. Labour say they will never be isolated in Europe. We know you sometimes have to be isolated in Europe if you are going to stand up for Britain’s national interests. If Margaret Thatcher hadn’t been isolated we would never have had the rebate. If I hadn’t been isolated, I would have lost the rebate in the Maastricht negotiations. I can tell you now there wasn’t another friend around that table who wanted Britain to retain her rebate from her European contributions which is worth literally billions to us. So you have to be isolated in Europe, you have to stand up in it.

We will seek changes to the Common Fisheries Policy. We don’t know what Labour’s policy is. We will seek changes to the European Court of Justice which is now seeking to change what the law is rather than interpret the law, most recently in the working time directive, but we don’t know what Labour’s policy is. We would have a referendum on a single currency if we decided to enter it. We don’t know what Labour’s policy is.

Now these are deep fundamental differences between the two major political parties at Westminster. That is the real debate. It is an important debate. But let us engage in what the real debate is in politics and not so much of the fantasy debate that we have seen over the last few months.

I will fight that election when it comes on the sharp differences between the parties and upon the issues that I believe matter most to the people of this country. And let me make this point to you. The economic changes we have seen, and the change in our economic prospects, will give unparalleled opportunities after the next general election to the government, opportunities that can be used in different ways, opportunities to change and shape our country that have not been there in recent years while we have been building our present economic strength as we have come out of the recession. The way in which those opportunities are used would be sharply different between the main political parties at Westminster.

I will use those opportunities in a way that will make them predominantly available to individuals and their families, predominantly available to the people. I believe they should have the first choice about how to make decisions that affect themselves, their families, their future and their interests. I don’t believe that will be the first choice of either of our main political opponents.

And as we come to the election, we need to focus on those choices. Whatever the outcome of that election is to be, it ought to be an outcome determined upon the basis of what genuinely matters to the people up and down this country. And that is not a froth and bubble of every day disputes, it is the fundamental issues that affect the future of this country constitutionally and the way in which people live their lives within it.

I believe we are right to lift the eyes of the nation to the opportunities that now lie ahead of us. It is time to rekindle the self-confidence that too often has been at a very low ebb in the last few years. We need to rise above the tendency to be negative, we need to recognise how far this country has come, and more importantly precisely what this country is poised to achieve if it has the courage and the imagination to take the opportunities that lie immediately in front of them.

We have perhaps the best opportunity in front of us that we have had for generations. We need to take it, not throw it away, not dissipate it, not lose it by even failing to realise that it is there.

I have a determination that Britain will become the Enterprise Centre of Europe. That is not just a slogan, it has hard-edged policy behind it. It is a statement of economic philosophy and a statement of belief, a belief that a free enterprise, low tax Britain can ride high as a global trading nation and win markets in every part of the world.

But we do need to get the balance right. By we I mean we the politicians, not only you the media. We need to get that balance right. It is no good talking ourselves down as a country and neither in my opinion is it remotely justified. This is a great nation, it doesn’t have an empire, but it is a nation of importance and influence, with standards and values that most nations in the world still look at with some envy and with very great respect.

Let us realise what we are and stop down-playing what we have done. We need, in my judgment, a proper measure of optimism and self-confidence to fire the enthusiasm and enterprise we need to take on the challenges of tomorrow. That I think is the debate that lies ahead of us. That I can tell you with every fibre of my being is the debate that I believe we should be having in this country at the moment. It is a debate of immense importance, it is a debate I look forward to with relish, and it is a debate I believe that I will win.

May 1, 1996
Mr Major’s Joint Press Conference with Helmut Kohl – 29 April 1996

Below is the text of Mr Major’s joint press conference with the German Chancellor, Helmut Kohl, held in London on Monday 29th April 1996.

PRIME MINISTER:

I would like first to welcome Helmut to the United Kingdom, he is a very welcome guest and we have had, as we always do, some useful and wide-ranging talks on a number of issues most of which I will set out for you in the next few moments.

Apart from detailed matter, of course we looked at wider strategic matters as well. We looked at the future development of the European Union; there are many areas in there where we are of a mind and some where we have differing visions but nonetheless we took the opportunity to examine those yet again this morning.

Of immediate and contentious matters, of course we spent some time discussing the particular difficulties that there are in the beef market in the United Kingdom and of course in the beef markets right across Europe. We discussed both the problems and the prospects for the Agriculture Council meeting today that perhaps will extend into tomorrow. The Agriculture Council of course cannot make decisions on this matter, it can only make recommendations for subsequent decision. I indicated that what we are looking for out of these discussions are some positive signals of support for relaxing the ban that at present exists; certainly we are looking for specific movement on the lifting of the ban on gelatine, tallow and related matters and I indicated to the Chancellor that I hoped that would receive some support.

There is a great deal occurring today in Brussels both in discussions and in bilateral contacts between the United Kingdom and our European partners and I hope we will be able to achieve some movement on this matter before long.

We also took the opportunity this morning of looking again at the sheer scale of the commercial relationship between the United Kingdom and Germany. There has also at the same time this morning been a meeting between leading businessmen in British/German trade and they joined the Chancellor and I for a pre-luncheon reception.

Britain is now Germany’s second-largest market around the world, Germany is Britain’s largest market for visible exports and a very important source of invisible earnings. There is a great deal of interdependence between our two economies, a very large number of German firms established here in the United Kingdom and a large number of British firms established in Germany. The trade flow between our countries is very large indeed and the mutual commercial interest is very great.

On European matters, as we look forward to the inter-governmental conference, we discussed in particular subsidiarity, that is to say ensuring that decisions are taken at the lowest possible level and not automatically at the European level; we discussed the prospects for better employment across Europe and for enlargement of the European Union and on these matters we have asked our staffs to work together very closely so that we may concert positions that are very close.

On competitiveness and deregulation the same circumstance applies: we are both concerned to improve competitiveness, we are both concerned to improve deregulation and there will be a high-level seminar on competitiveness later on in the summer.

We talked about the prospects for monetary union. We do have differences in enthusiasm about that and an agreement upon the importance of the economic criteria before such a step could be taken and agreement that those economic criteria would need to be sustained. The British position is I think well understood by the Chancellor and we had an opportunity to discuss it this morning.

We both agree very strongly on the need to sustain the transatlantic partnership and have decided to establish a new trilateral United Kingdom/Germany/United States-parliamentary forum. We think the importance of keeping the parliamentary opinion of these three countries in concert is extremely important both in the short and the long term.

We discussed foreign affairs and followed up on our brief discussions at Moscow. We talked also about Moscow and about my visit to Ukraine.

We discussed also Bosnia where the cooperation between Britain and Germany is excellent and where we have a joint view of present developments and a joint understanding of what we hope will be achieved later in the year.

Defence cooperation with Germany continues to be both deep and wide-ranging.

We discussed the prospects for the North Atlantic Council foreign ministers meeting in Berlin in June where one of the key themes will be the adaptation of NATO structures to deal with the evolving and changing nature of NATO.

We also discussed the question of NATO enlargement where British and German views are very close indeed.

We discussed also a number of other bilateral matters and in particular the joint wish that we set in train a couple of years ago to ensure that there were greater exchanges between young Britons and young Germans, one to the other’s country, to improve greater understanding for the future.

We had a very wide-ranging discussion indeed which was conducted in the friendly spirit that I have come to expect in discussing matters, even contentious matters, with the Chancellor and I am delighted that we were able to have such a fruitful meeting.

CHANCELLOR KOHL:

Allow me, if I may, to first of all use this opportunity to thank the Prime Minister most sincerely for the very warm hospitality with which we have been received, I myself and the members of my delegation, here in Downing Street. It is one of these visits that is part of our ordinary exchange of opinions but using the word “ordinary” does not actually correspond to the reality. It is more like a visit between very good friends because the relationship between the United Kingdom and the Federal Republic of Germany is an excellent one and the personal relationship between the Prime Minister, my friend John Major, and myself is excellent and because friendships between politicians and those who are responsible in politics do not automatically remove problems, I have never been under that kind of illusion. That may be true but on the other hand such a personal relationship – such a good chemistry as the Americans put it – between two people certainly helps to smooth the way a little bit, even in those cases where one may be of different opinions and it was actually purely a matter of chance but also a good occasion for me here at this Round Table because it afforded us a good opportunity to meet with representatives of the business communities of the two countries and the Prime Minister underlined once again how close, how useful, how important, particularly the economic relationship between the two countries is and in my statement to the Round Table I said that after all British Officers launched the initiative for the Hanover Trade Fair that now has become the largest industrial fair in the world and I was very pleased to learn that next year, the jubilee year of the Hanover Fair, the United Kingdom will be the partner country of the Hanover Fair and I think we have every occasion to turn this into a big bash celebrating the friendship that has evolved between our two countries and business communities over the years and this meeting between the two business communities has actually also served to underline once again that we are here on a very good course in further intensifying our economic relationship and our exchange of views. I must say that from our talks today I took away a number of hints as to where we can come to improvements.

We talked about a number of issues that are of mutual interest. We exchanged views during this admittedly rather short meeting about a number of issues. We also mentioned obviously the governmental conference on Maastricht 2 which was, as you know, inaugurated in Turin and we talked about further developments. I must say that it is of tremendous importance to me that we should cooperate as closely as possible with our British friends in this particular stage of European integration and we talked in very concrete terms about how matters are developing and I would like to say this here most clearly because sometimes I read in the British papers the exact opposite. I would like to state quite clearly what my position is exactly.

I am a champion – and a fervent one at that – of building this house of Europe at the turn of this particular century that has seen such great suffering, that we should make room in this European house for our partners and friends in Europe and that we should make room on a sort of permanent lease for our American friends. It is unimaginable for me that this common European house might be one house where the United Kingdom does not have a firm position and its place.

I know that internally you have a lot of discussions going on here in the United Kingdom and certainly here would not be the place nor the time for me to barge into that but there are voices I sometimes hear in public here that there are people over there in Europe who want to push the British out of Europe. This is absolutely not the case and it does become any more true because people repeat it. I will certainly not act for a Europe where the British do not have their firm place and position but I do think that in building this European house we should bear in mind the different traditions, different historical developments, different geographical situations and also the different kind of roads that we have to travel to get to these goals and this is why I say it is so important that we should bear each other’s interests in mind, that we should not enter into an almost theological debate where we say we have the whole truth and nothing but the truth and the others are completely wrong in what they say but that we should come to a working together and cooperation that is characterised by common sense and I am very much persuaded that then we shall have a great opportunity to make headway, to take a big step forward. Obviously, there are areas where we have different opinions the British and German governments, and there are areas where we are very close together.

With the European Union we may have a different opinion as regards the two of us and the other partners on subsidiarity for example. That is a word that I know many people simply do not understand the way we interpret it. I would define it in a very simple way. I would say that when building this common European house – using now Brussels as a synonym for the European Union – I think we should opt for Brussels taking only those decisions that can be taken at that level and can then benefit citizens the best and decisions that can better be taken on a national level, for example in London, Paris and then later on in Berlin, those should be taken on that particular national level and those decisions that are best taken at a regional level – in Germany for example on the level of the Laenders – should be taken on that particular level. That is an issue that obviously we need to elaborate on a little bit further and in Maastricht 2 we will also have to ask a question as regards the [indistinct] local authorities in the European Union.

I only mention these few examples to illustrate that I do see very good chances for coming to a common kind of position and that I will tenaciously hold to the view that this is indeed a policy which is not aiming at isolating anyone but that this is a policy which serves as a policy of rapprochement of the British, of the French, the Italians and all the other partners in the European Union.

I don’t want to go into another issue now at length but I think I should raise it at least, BSE. I think that today and tomorrow, from what we have heard, the Agriculture Council will discuss the proposals submitted by the British Government and I think that those proposals should be then discussed as quickly as possible by the Veterinary Committee of the European Union and I would wish for the Agriculture Committee not leaving matters at that tomorrow but coming to a decision as quickly as possible.

I am very much looking forward to your questions and since you are very often writing about me, I would even more welcome you writing about me when I am actually here to answer your questions.

QUESTIONS AND ANSWERS

QUESTION (Robin Oakley, BBC):

Chancellor Kohl, you have frequently said that Europe cannot afford to travel at the pace of the slowest ship in the convoy. Have you persuaded the British ship, in your talks with Mr. Major today, to move any faster?

Can I ask the Prime Minister whether he and Chancellor Kohl have agreed that there should be any relationship between countries which stay out of an inner-core single European currency, any exchange rate mechanism to link those who stay outside and those who form any inner core?

Finally, could I ask Chancellor Kohl if he did eat beef for lunch today?

CHANCELLOR KOHL:

Just as my friend John Major, I had indeed beef for lunch and I ate it and I think that was probably the underlying purpose for this press conference – to answer your question!

What you have said by way of your second question you quoted me correctly but then automatically transposed that to the United Kingdom. This was not my meaning, that was your opinion from the BBC. I did not automatically declare the United Kingdom to be the slowest ship in the convoy which is why I cannot give you an answer to that question.

PRIME MINISTER:

Let me pick up those points.

We had an excellent luncheon.

As far as the slowest ship in the convoy is concerned, I am delighted that the Chancellor was able to respond to that because it isn’t the only occasion where a remark like that has been wrenched out of context domestically and there has been an assumption that it was the United Kingdom that was in either the Chancellor’s mind or whosoever may have made such a remark in the European Union. That isn’t the case. Indeed, one of the things the Chancellor and I have been discussing today is the desirability – the necessity – of a more flexible approach to Europe as Europe develops further and I think it is much to be hoped that people will appreciate that those are the sort of things that are under pragmatic and detailed discussion at the present time.

We didn’t spend a great deal of time discussing the possibility of a fresh exchange rate mechanism, our finance ministers discussed that some time ago and I think the British position on that is well known and hasn’t changed so we didn’t spend any time particularly discussing that this morning. We did discuss the range of matters that I set out and the Chancellor set out.

CHANCELLOR KOHL:

I should perhaps mention and add to what the Prime Minister just said on this last point.

We shall decide in the spring of 1998 on this matter and not a minute earlier and therefore I don’t think it makes a whole lot of sense to enter into philosophical debate on what may or may not happen. In my day-to-day life as a politician, I am in many cases forced to take certain decisions but in Germany too a new form of penitence seems to have evolved. In former times, usually you had your sin first and penitence later; today, you have penitence and also the sort of penalty first and then the sin but I am actually one of the old school for that matter.

QUESTION:

You are never enthusiastic about this kind of building and you showed a certain reservation about enthusiasm in European development when you made your statement just now. Can you enlarge on this a bit?

PRIME MINISTER:

I don’t think that there is any doubt at all about the British wish to see Europe develop. What the main debate is about is the nature, pace and style and the purpose of the development and there is a great misunderstanding I think often in this country – partly it is linguistic, partly it is simply modes of expression – as to what is often meant by what is said by our European partners. The Chancellor is here so he will want to add something to this.

Often, when people talk about a “European house” in this country referring, to what has been said in Europe, there is an assumption that that European house is going to be centralised, that all the decisions are going to be taken at the centre and more and more is going to be sucked away from the nation state. That isn’t the sense in which it is frequently used.

I cannot envisage a time in the future when the Germans aren’t Germans, the French aren’t French, the Italians aren’t Italians in all their instincts and the British aren’t British so I think we should actually look at what pragmatically we are discussing with the development of Europe.

Where are the areas of development that are of importance? – The single market. Who were the proponents of the single market? The British and the Germans were the great proponents of the single market. What is another area of great development? Enlargement of the European Union in order to spread the opportunities that exist in a democratic free market further across Europe. Who were the great proponents of enlargement? The British and the Germans were the great proponents of enlargement. Who were the proponents of saying too much must not actually be centralised? You have just heard the Chancellor speak of subsidiarity; he and the British are very much at one upon those points.

The area where there has been some difference is the question of a single currency and Germany are clear that Germany favours a single currency. I made it clear at Maastricht that we reserved our position on a single currency.

We both want to see – if you wish to use the parlance – a European house, it is the nature of the construction that is a matter of legitimate debate and if I can make the point, it is a matter of debate. It is not a matter of artificial conflict as it is so often presented. Britain and Germany agree on many things, we disagree on some other things but I think I can say – and I think the Chancellor will confirm – that where we disagree we don’t disagree with animosity, we disagree because we both recognise that the other country has a legitimate point of view and to borrow the Chancellor’s comments of five minutes ago, different traditions and a different historical experience.

In the discussions that I have had with the Chancellor and my European partners I have found that understanding. It doesn’t alter the fact that on some issues we have different policies but those differences aren’t the subject of unpleasant and nasty disputes. It is a question of how we develop in mutual interest and there will be differences about that and we will see those gradually solved as Europe develops.

CHANCELLOR KOHL:

Allow me, if I may, just a brief remark on that particular issue. Let me be very frank with you. It is not a question that may be of any local importance from London or for Bonn, it is a Europe-wide issue. I don’t understand this discussion at all because it sometimes demonstrates an impatience that I find absolutely absurd. I remember my first EEC summit, as it was called then, in Copenhagen in 1982, at the time the word that was most widely used to characterise the European Community was Euro-sclerocis, a very bad disease that had befallen Europe. And now here had I in the December of that year been here in this room with you I would not have believed that we would have come so far as we have come and everyone told me at the time it will not work, the internal market won’t work, Maastricht 1 will never come about, and then all of a sudden the treaty was there, and then people said it will never be ratified.

So again and again we overcame those hurdles and we did move forward and it is simply not true that we have taken too long. Just look at European history over the past 200 years and it is only then that you have a correct yardstick as to what sort of distance we have travelled.

Let me mention one example where we do disagree, at least at this particular point in time. For example on the issue of Maastricht II as regards intensification of our cooperation in the area of internal and justice matters, now if it were the case that we will not be able to come to some sort of conclusion in Maastricht II, would it be such a terrible thing if we were to find a formula that allows us to look at this matter again in let us say 5 years time. And then in the meantime we try to come to some sort of common decisions on an intergovernmental level. And these decisions will come, no matter what we may say now, at the very latest in 5 – 6 years there will be no European government that will be able to stand for elections and win the election shirking away from combating the threat from international crime and taking a defensive stand on it. And we will see that we will not make any headway on this particular issue on a purely national level. And it will be just the force of the situation as it stands at that time that we have to come to some sort of European-wide settlement. Obviously we have incredible amounts of drugs, for example, that are being brought into the European Union. This is not the fault of our police, but we have to come to a European-wide solution for that.

So perhaps let us first of all come to some intergovernmental agreements. But it won’t be the end of the world for me. The decisive thing is let us make a move in this particular direction. And I am a pragmatist and it is rather a strange occurrence that it should be a German all of a sudden who opts for pragmatism because we have always been accused of doing exactly the opposite.

So I am for a step by step approach and we shall make progress in one field and perhaps not in the other field, so well then there are areas where for the moment we will not make any headway at all, but this common European house will be built perhaps with different stages of development, but it will come about.

QUESTION:

Chancellor, I was interested in that last answer when you talked about internal discussion in this country, would you accept that some of the difficulties are driven by what people see as a relentless timetable towards EMU in the treaty, though Britain has its opt-out, and your own great enthusiasm for political union and that worries people here, and could that perhaps go slower as you suggest that other things might go slower? And Prime Minister, could you ever accept a situation where individual candidates, standing in election, could say in their individual addresses no to a single currency when that will not be your position in the main manifesto at the next election?

PRIME MINISTER:

On the second question, I suggest you wait for the election. The government’s manifesto will be quite clear, our position on a single currency is quite clear. We have said repeatedly that we don’t have the information upon which to base a proper decision at this stage. It is the most important decision that anyone is going to take for very many years, it has to be right, the economics have to be right and it is folly to take a decision in advance of knowing what the circumstances may be, for a country with the trading tradition of this country and the importance of sterling at an international trading currency. So I don’t anticipate the problem that you refer to arising, I read about it in the press, I don’t anticipate it arising and I think the position we will set out in the manifest on a single currency is well known.

CHANCELLOR KOHL:

I must say I don’t see this, what you mentioned. Without this kind of planning, without this kind of timetable, we would have lagged significantly behind the sort of progress that we have achieved. Let me give you one example that applies to Ireland, but that actually in more ways than one applies to the rest of the European Union as well. Ten years ago, for example, I had a number of fights with Francois Mitterrand. It would have been inconceivable at the time that as regards the matter of convergence of economic policy we would have made the sort of headway that we have made, and the citizens in Europe, after all, have drawn a great benefit from that. I don’t know, as regards the EU average, as regards inflation, but I think generally in the UK it is between 2 – 3 percent, and I was told when I was a student at the university that this is virtually no inflation, and I think you have 2.3 or something, so that means it is the kind of social policy that is geared to those who have small incomes. So why don’t we talk about the positive results that this has yielded for individual citizens?

QUESTION:

Do you both think that you could win a referendum about the single currency in your countries?

PRIME MINISTER:

Well we will have a referendum in this country if and when a British Conservative Cabinet decides to enter a single currency. If that were the case then we would clearly campaign for that. The answer, if you ask me whether we would win such a referendum today, is no we would not win such a referendum today, but then there is no prospect of us joining today so the situation does not arise.

CHANCELLOR KOHL:

As far as I am concerned I have never been a great friend of this kind of democracy that is plebiscite because I am familiar with German history and up until 1933 it was not purely a coincidence that the fathers and mothers, as it were, of our constitution were very familiar with the Weimar Republic and later on very familiar with the concentration camps under the National Socialists who [indistinct] champions of democracy. And if we had this instrument in our constitution I would certainly not hesitate in using it, but if I use it for this particular area of politics I would have to use it for other areas of politics as well and I have great doubts whether that would actually lead and improve internal peace in our country because there are a number of issues, on for example immigration, that in many ways move people a lot in Germany and we don’t intend at all obviously to introduce that, it would mean changing our constitution and I have no intention of doing that. But if you ask me in concrete terms that if we held that, how would we decide, and I have no doubt at all that if we had this kind of referendum the majority of people who are well informed in our country would opt for it because they know that peace and [indistinct] of the 21st century depends on matters such as these.

QUESTION:

Chancellor, you have eaten British beef today and enjoyed it. Would you now tell the world clearly here today – eat British beef, it is safe and enjoyable?

CHANCELLOR KOHL:

I ate British beef but I am not a marketing manager for British beef. I said what is going on in the Commission and you don’t honestly expect me to say something like this, a sort of advertising slogan.

QUESTION:

Can I ask you both would it be possible for a member state of the EU to go on enjoying the market advantages while resisting any deepening or further integration of European institutions?

PRIME MINISTER:

I gave you the answer some time ago when I said we were talking about the problems that develop in the Community and the advantages of flexibility. The European Union is flexible now. There are a whole range of flexible instruments within the European Union. The two most obvious ones are the position of the Danes and the British, for example, on a single currency; the position of the British on the social chapter, but they are by no means the only illustrations. So the answer is yes.

CHANCELLOR KOHL:

I don’t have this kind of concern, I don’t have the impression that we have this particular kind of problem that no-one wants to get into the European Union, quite the contrary, I think we have rather the opposite problem, there are so many who want to come at the same time, so I don’t share your concern. Actually the European Union seems to be one of the places to be in the world. If you don’t believe me, go to Tokyo, go to the Wall Street Bank of New York and ask them, to Latin America, other parts of this world, why do all of these people want to do business with the European Union, why at this conference that both of us attended in Bangkok only a few weeks ago meet with such interest – because we are the place to be.

QUESTION:

You said before that you would urge the Agricultural Commission to speed up the decision on the beef ban. Do you also respond to the Prime Minister’s request for help and support in a partial lifting of the beef ban?

CHANCELLOR KOHL:

I don’t think it would be entirely fair, I mean I am standing here as the German Head of Government and I am not part of those negotiations. My colleagues therefore are meeting there in Brussels today and tomorrow, they intend to look at the British proposals, they will submit it to the Veterinary Committee in order to examine it. The only plea I have is don’t let matters stand as they are but do it as quickly as possible and then there will be a concluding session where we come to a decision. But I don’t think it would be in any way a reliable or very serious answer that I could give at this point in time. After all, the debate will take place tonight when the individual Agriculture Ministers meet on that matter.

QUESTION:

Chancellor, Douglas Hurd said at the weekend that you no longer believe in a European super state, I just wonder if you could confirm that analysis or not. And Prime Minister, on the matter that Mike Brunson raised, are you worried that some people in your own party are now using the alleged electoral threat by Sir James Goldsmith to have one last push at making you rule out a single currency in the next parliament?

PRIME MINISTER:

Let me answer that point first. I think you must ask other people what their motives are. I have made the position clear. We will decide upon a single currency when it is necessary for us to decide upon a single currency and we are not going to do that precipitately. I know many people think it would be extremely convenient if I were to say now, no we are not going to do it. But I think in the national interest I need to see what the circumstances are, I need the British voice in the negotiations right up to the time when the decision is made. I don’t want the British voice to be excluded from those negotiations.

Whether we in the event turn out to be part of a single currency, or whether we in the event say we will not be part of a single currency, what happens in the development of that currency is important to the national interest in this country. If our European partners proceed with it, it is not a matter that we can just ignore, it will have its implications not only for those countries but for every country right the way across Europe. And frankly, for a country of the size and influence of the United Kingdom to exclude itself from the most important economic debate that Britain has had for 50 years, and will have for 50 years, does not seem to me to be in the British national interest.

So we will not exclude ourselves. We will make a choice when we are compelled to make a choice and then we will decide upon the basis of what we think is right for this country at that stage. So there will be no change in our position upon that point.

CHANCELLOR KOHL:

I am not familiar with this particular quote from Douglas Hurd’s speech. If I understood you correctly, you said that he had said I was no longer a proponent of the European super state. If this is actually what he said, I don’t quite understand how he can say something like that because I have never been a champion of a European super state, perhaps he has read it in one of your papers here but it has certainly never been an opinion of mine. For a time perhaps there have been a few misunderstandings, because we actually adopted a sentence out of Churchill’s Zurich speech, it is a very beautiful speech and a very beautiful phrase, but I think it was a bit misleading for our people. At the time I was 17 years old and he appealed to the Europeans, to the Germans, the French, but to the Europeans generally speaking that they should build these united states of Europe and perhaps that was a bit of a misleading kind of slogan. I used it for several years and the association obviously was that people thought we wanted to build the United States of America on European soil, but this is something that we never wanted and we have always said we remain Germans, we remain British, we remain Swedes, and this is different than being from Texas, from Oregon, from Minnesota or New York. This is a misleading kind of comparison even though it may be from Winston Churchill and may sound very nice.

I actually gave a speech a few years ago at a party meeting that because it was misleading we should no longer use this particular expression. I said we are building the European Union and the European Union, and again I think this is a bit misleading perhaps and may lead to different interpretations between the British and the Germans and I did try to define what I mean by mentioning this image of a common European house. It simply cannot be a centralised state and even though the British and the Germans may be of exactly the same opinion as regards the approach, we talk about federalism and for many people here in Britain in what we understand as federalism means quite a different thing.

What we understand when we speak about federalism is exactly what you want, but it is perceived differently here. We are saying on the level of the citizens, on the local level, on the land level in many areas of Europe, on a regional level, this is where decisions should be taken that can best be taken there, this is what we understand when we speak about federalism, it is exactly the opposite of a centralised state. I have always been a very fervent champion of federalism in Germany. I would hold that one of the most important, and then subsequently most positive decisions by the parliamentary assembly when they drew up our constitution and basic law was that they sort of tried to make room for the sort of variety that has always existed in Germany, that the Lander, that the Bavarian, the man from the north will find that he has left an imprint on the constitution and that they all are part of one whole. So I have certainly not said at any time that [indistinct] super state.

First of all I would like to thank Douglas Hurd for actually mentioning me at all because it is after all always an advantage. I have never been a man who has been a champion of federalism. I have always been, in the German sense of the word, how we understand it, not how you British understand it, a federalist. And actually those who think alike here in the United Kingdom should be creative and come up with a different kind of expression that exactly says that – this building of a common European house. So thank you once again. I will read your leading articles and will see what you come up with.

April 29, 1996
Mr Major’s Speech in Rugby – 26 April 1996

Below is the text of Mr Major’s speech in Rugby made on Friday 26th April 1996.

PRIME MINISTER:

Let me touch on a number of things including prospects and some of the things I may say to you over the next few minutes may perhaps surprise you, but I hope pleasantly in a range of ways. Let me firstly just set out precisely where we are economically and how we got there.

It is not all that long ago that we and the rest of western Europe, the United States, Japan, most of the world in fact, south east Asia perhaps excluded, were in the midst of perhaps the most severe recession that we had seen for 20 years or more. When we went into that recession, I made a promise to myself and to my colleagues that we have kept and that is vital for the future of our economy. The promise I made was this: we will do nothing during the recession that will mean when we come out of the recession we have laid the seeds for future problems. Time and time again that has happened in recessions, as economic cycle succeeds economic cycle since the War we have seen that problem. Recession, pressure, the Government takes action, it gets out of the recession but the seeds are laid for a fresh inflationary spiral and we go, after another move in the economic cycle, back into the same problems. How many times have we seen that happen since the War?

I have had vivid experience of inflation. You have of course as businessmen, you know the perils of it, I needn’t spell them out to you, but I have to say to you, quite apart from the business perils there is a social implication to inflation as well that I feel extremely strongly about, too strongly perhaps you may feel but I will express it for you:

If you have ever been in a position where you wonder at the beginning of the week whether your family can pay the bills at the end of the week because the prices are going up, then you begin to see inflation not as some abstract economic theory but as something that threatens the very security of the way you live so I loathe inflation and I make no secret of the fact that I loathe it and we have taken every precaution we can to prevent that inflationary genie escaping from the bottle again and what is the result of what we have done during the period of the recession. And I would like you to bear in mind when I say that that we have lived in the same economic climate as our partners in Germany, France and other parts of western Europe. What are our economic circumstances now?

We have inflation under 3 per cent for the third successive year and it is still going down, we will hit our target of 2.5 per cent or less at the time of the next general election. Apart from the social implications, you don’t have to worry in your future planning in the way you once did about whether Your investments are going to soar in cost because of inflation or whether the projections upon which you based your investment will suddenly fall apart. That is the first point to be made.

The second point is that a very unusual economic trick has been pulled. Not only has inflation come down but contrary to what we have often seen, inflation has come down in parallel with unemployment. Unemployment has dropped by three-quarters of a million in the last couple of years or so.

What has happened elsewhere in western Europe in those countries in the same markets, in the same economic environment? As our unemployment has fallen steadily, theirs has gone up. If you look at Germany, their unemployment rising far higher than ours; in France, their unemployment round about 12 per cent, stuck, no sign of it coming down. We are below 8 per cent and falling. And neither is that a false measure. Not only do we have a lower rate of measured unemployment, we have a higher percentage of our workforce actually in jobs than any major economy across Europe through inflation below 3 per cent and falling and unemployment falling. There are not a lot of people in this room who will remember when that combination was as secure as it is at the present time.

Has it been done at the expense of nil growth? We have had larger growth in our economy over the last couple of years than our competitors across Europe; that is going to be the case this year, it is going to be the case next year, so low inflation and falling, too high unemployment but lower than anybody else and falling and growth as good or better than any of the other European countries. What has happened to competitiveness? You know very well what has happened to competitiveness. We are now taking markets we haven’t had for generations in this country, exports are running at record levels. Go and listen not to what I say – I suppose there is an element of “well, he would say that, wouldn’t he?” Go and see what German industrialists and other people say, have a look at the booklets on your chairs and see what businessmen here and politicians and businessmen abroad have to say about the British economy. There was a time when we stood here and looked at the economies of our competitors and wondered how they did it. I wish the extent of fashionable opinion in this country would wake up to the fact that that is now happening in reverse; those countries abroad are now looking at Britain and saying: “What has happened to her? How has she suddenly produced an inflation record like this, a job-creation record like this, a growth record like this and increased her competitiveness?” so that as we meet here today, we are probably the most competitive industrial nation in western Europe.

That is where we are, the question is what do we do with it because that factor is apparent. What we have built is the platform for future prosperity but the prosperity itself needs to be built and it needs to trickle down to the people up and down this country who by their efforts have played a part in creating the opportunities that now lie in front of us.

We had to put up taxes, something I loathed doing but it was taxes going up or high borrowing and interest rates going up instead. But now we have begun to reduce taxes, the first tax reductions are in this month’s pay packet and they are well worth having. I hope we will be in a position to do more, as soon as we prudently can, we most certainly will.

Let me touch on two or three other things:

Peter mentioned the social chapter. That is one of the principal reasons why we are more competitive than other countries. Not the social chapter as it is but social expenditure as it is across Europe. Let me give you the figures:

For every £100 in wages that a British employer pays, it costs them an extra £18 in employers’ national insurance contributions and on-costs of that sort. In France, Germany, Spain and Italy, it is between £30 and £45, a huge competitive difference.

Why does the social chapter matter? Our political opponents say it is a set of principles – a set of principles like Cathy of Clade [phon] was conductor of music! It is not a set of principles. These are policies that you can’t opt out of once you sign the social chapter and the problem is not what is in the social chapter today, it is what would go into the social chapter once every European country was signed up to it and what would go into it is the sort of social provision that exists in the nation states of Europe but not here but that would come into the social chapter by qualified majority vote to diminish our competitiveness against our partners were we to be so foolish as to sign the social chapter. Let me give you a couple of illustrations:

There are some very large companies in countries like Germany and Austria; if they had to make staff changes perhaps for an extremely good economic reason, they can’t do it without going through a works council if they have more than 5 employees. If you want to work overtime in the country of one of our European competitors, you actually have to get permission from the government in order to work overtime. Can you imagine the questions? “Are the staff fit? Is it Sunday? How much are you paying? What is the reason for this?” By the time you have sorted all that out, the export order for which you wanted your workers to work overtime has gone to Britain I hope, because we are beginning increasingly to be able to [indistinct].

Let me just say a word about taxes:

All the figures upon which people can base their broad tax projections are in the public sector. You can’t be detailed, I accept, but the broad figures are there, there is nothing hidden, our accounts are as open as the accounts of any nation in the world so anyone can have a pretty good idea what their tax objectives are, they don’t have to hide behind obfuscation and downright deceit.

My tax objectives are perfectly transparent and clear. As soon as I am able, I wish to reduce taxes further and I wish to go down to a 20 pence basic rate of tax, I am not changing the upper rate of tax and then I want to tackle capital taxes because I think they damage the market, they damage job creation and what we need is job creation and a competitive environment to keep our people in work and to put more of our people in work. These are our objectives.

What are our opponents’ objectives? It is very difficult to say. When asked privately, the leader of the Labour Party said: “We aren’t going to touch people up to £30,000!” which I would have thought to any rational observer would have meant they are going to touch people earning over £30,000 but after that remarkable slip of the tongue, one of the leader of the Labour Party’s minders rushed along to the press to say: “He didn’t say that, he didn’t mean it, it never happened!” Claire Short – bless her honest, cotton-picking socks! – [laughter] seems to think it should happen; she is very well paid. Mr. Prescott is middle class, he is very well paid! Nobody doubts where the instincts of the Labour Party lie or what will happen. I don’t know what the editors of some of the great Labour-supporting newspapers who earn large sums of money think, I hope they have worked out how much it is going to cost them if the upper rate of tax goes up from 40 pence to 50 pence which is the minimum demand of the Labour Party in the House of Commons or perhaps 60 pence but certainly a very expensive proposition.

The people I am concerned about are the people up and down the country who at the moment are being told one thing by the leadership when it is transparent that that is not remotely what their position would be likely to be were they in government. That tax slip of Mr. Blair’s was brushed to one side. Gordon Brown was a bit more explicit on another aspect, on child benefit. Because he is being pressed on tax, he decided he had better display a touch of virility so he decided to announce that he was going to take away child benefit for people with families of youngsters between the ages of 16 and 18 who decide to stay on at school. Let me say something about this:

I left school at 16. I didn’t leave school at 16 because I didn’t want to stay, I didn’t leave school at 16 because my parents wanted me to leave school at 16. I left school at 16 because we could not afford for me to stay at school and I chose to go out and work; my parents didn’t like it but I chose to go out to work.

If you take child benefit away from any youngster in any family, perhaps a low-income family, perhaps not but very many families on low incomes are desperately keen that their children should have a better education, a better opportunity, a better chance than they ever had and these days 1 in 3 of our youngsters go through A-levels and on to university and I am proud of that and I defend the expenditure to make sure that that is possible but if in future Labour were to carry out this plan and have the opportunity, you have a youngster of 16, 17 or 18 going on to A-levels, as they should, they will lose a £560 child benefit every year for each child. Most families have two children, often only a couple of years between them, you will get a rolling effect that dwarfs any tax changes we have seen for generations and how well-targeted it is, targeted directly upon many of the people who have the lowest incomes in the country – £560 a year gone.

Apart from the stupidity of that in inhibiting youngsters whose parents have modest incomes going on to further education, it is thoroughly dishonest for this reason: child benefit was a tax allowance. We changed it from a tax allowance to a cash benefit payment so that it actually went directly to the mothers to be used predominantly for the children because of concerns that that wasn’t happening. What would be happenings is you would be taking away a tax allowance and what is the equivalent in tax? For someone on average earnings, that is the equivalent of an increase of 5 pence in the pound on the standard rate of income tax if that was actually withdrawn from families. That has crept out without the Labour Party realising exactly what it would have meant for people. If that has crept out under pressure, I would like to know what else is lying hidden that needs to come out and that we need to examine before we get towards the next general election.

Peter asked whether we are going to win. I remember Peter asked me that before the last general election. [Laughter]. I look forward to Peter asking me that before the next general election but one and I will give him the same answer: yes, we are going to win and I will tell you why we are going to win:

We are going to win because when you strip away the absurd hyper-exaggeration of everyday news events, what is happening in this country at the moment is that we are producing the most stable economic platform that we have seen for generations. What a tragedy it would be if, having gone through all that has happened in the last few years to create that environment and that opportunity, it were to be casually tossed away with the sort of policies that a change of government would bring about.

I don’t think that will happen but I don’t base my confidence only upon the economy though I am confident about the economy. I base it on one or two other things that hit here [touching part of body?] rather than in the wallet and the first of those is the proposal for constitutional change that our opponents have. If you wanted to draw up a recipe that would divide and break up the United Kingdom, you would draw up the proposal fox constitutional change and particularly a tax-gathering parliament in Scotland that the Labour Party have committed themselves to. Once you get that parliament in Scotland, within a measurably short period of time if you are going to have the parliament, you would have to have a Labour government and Labour governments; like all governments, become unpopular.

Mid-term elections in Scotland and who is likely to win? There is a possibility that the Scottish Nationalists:- separatist party openly declared for separatism – would become the majority party in the Scottish parliament and what mandate are they going to claim? Is it really credible to have a Scottish tax-gathering parliament and still have public expenditure from the rest of the United Kingdom spent in Scotland at a much greater level per head of population than it is in England? Of course it isn’t practical. Is it practical to have Scottish MPs at Westminster voting on matters that affect England while the same English MPs in England cannot vote on the same matters affecting Scotland? What sort of recipe for chaos is being unleashed with its ill-thought-out porridge that they are producing for Scotland?

What have they got against the Scots that they should pay more taxes? What have the Scots got against themselves that they could contemplate any party that would want them to pay more tax?

Then there is the question of Europe. No issue has been more explosive, no issue has been more misrepresented, no issue has been more conducted in stereotypes with the debate often determining itself only on the fringes of argument – those who are fantastically opposed to Europe and those who are fantastically in favour of Europe. There is a middle and it is a very large middle. I don’t know how many of the businessmen here have half their trade going to the European Union and back but I bet a majority of you do because half of all our trade goes to Europe and back so we have a real interest in playing a constructive role and arguing our case. Removing our influence and standing on the outskirts would mean that the problems that we are having with beef, where I am in great dispute with our European partners, could be magnified over a whole range of issues if we were outside the European Union or not playing a part in trying to determine the rules of the European Union but that doesn’t mean we are going to go into a federal Europe.

I can tell you quite frankly I have no intention whatsoever of going down the route to a federal Europe. I just don’t believe it would be right for Europe to go in that direction and I know that it would not be right for this country to go in that direction and we have no intention whatsoever of doing so. We will argue the case, we will debate the case, we will win the case – in which case all is well – or we will not win the case and we will just say “No! You can go in that direction if you like but we are not!”.

At Maastricht, we had huge disputes. Nobody truly believed that I would come back from the Maastricht debates having said “Non to the social chapter and “No” to a single currency with the opt-out. The City didn’t really believe that, none of the newspapers believed it. If you promise not to tell anybody, even some of my colleagues in the House of Commons didn’t believe it! [Laughter]. I know you will find that hard to believe [laughter] but I promise – and tell not a soul – that they didn’t. But at the end of the negotiations there was a choice: no treaty at all because it is agreed by unanimity or recognising that Britain has a distinct view and we are not going to be pushed in that direction.

At the inter-governmental conference in front of us, the same principles will apply. I have set out with great clarity what our negotiating position is in the negotiations and if I have to say’ “No” I will say “No”. I did before and I will again, not because of parliamentary pressures at home, not because of public opinion at home – not just because of those things but because what is in the White Paper on Europe is what I believe about Europe and I have to say I am pretty fed up with the absurd commentary which says you either have to be on one wing of the European argument or the other wing to have any views at all. Well my views are very clear. On one hand, I am being told always that I am shifting my position, on the other I am being told I am being told I am too stubborn and why don’t I listen to people. I am happy to accept one of those if someone can make a credible case for it but I am just a touch concerned that having both of them often on the same day on the same page of the same newspaper written by its seems to me the same person who clearly is not perhaps wholly convinced of his case.

We are not going down the federal Europe route but our political opponents are, the Liberals because they believe in it, the Labour Party because they believe it is fashionable. I just believe it is wrong and when we come to the general election that will be a big division so there will be divisions on tax, divisions on the constitution, divisions on Europe and great divisions on education and other matters.

The fact of the matter is, Peter, when people come to vote in a general election, forget the nonsense of by-elections, the protests – “Oh my God, I’m sick of those people, let’s not bother to come out and vote today!”. You have got real issues, issues that affect the family, the money, the future, the country and upon those issues I am perfectly prepared to take my Conservative case to the country and just as I recall at the last general election as we entered the last week 7 or 8 per cent behind on the Sunday before the election, with every newspaper writing us off and wondering what Mr. Kinnock was going to do in Downing Street, I didn’t believe the polls then, I don’t believe them now, I thought we would win then and I was right, I think we will now and I will be right again. [Applause].

April 26, 1996
Mr Major’s Press Conference in Turin – 29 March 1996

Below is the text of Mr Major’s press conference, held in Turin on Friday 29th March 1996.

PRIME MINISTER:

I should first apologise for the absence of the Foreign Secretary, but he has gone to the start proper of the intergovernmental conference.

The discussions that we have had today have really been the tale of two topics: firstly, the intergovernmental conference, the agenda and the way in which it will develop; and secondly the current problems that exist as far as beef is concerned. Let me take those two issues separately and tell you what has been happening and the view that the United Kingdom government has taken.

I will start, if I may, with the intergovernmental conference. I am very pleased at the outcome of the discussions that we have had today, and in particular the fact that we have agreed a non-prejudicial agenda that gives Britain a free hand to pursue her objectives of developing Europe as a partnership of nations.

I think it is clear that the mandate that has been set is one that is satisfactory to all nations and will enable us to pursue the objectives set out in the white paper that we published just a few days ago.

If I can pick out some of the elements from the agenda. Quite a lot of support, notably from Germany, on the subject of subsidiarity. We need also to look at the role of national parliaments, the working of the European Court of Justice and the re-weighting of qualified majority voting. I made it clear again this morning that Britain sees no case whatsoever for any extension of qualified majority voting. I very much welcome an agenda that sets these discussions in the IGC in the context of the challenges the European Union faces.

I also made it clear this morning that as we look at the future development of Europe, we are going to have to tackle the situation that has arisen under which social measures are effectively brought in by the back door using the health and safety article of the Treaty, Article 118A. If Europe is to develop in a spirit of trust and cooperation, I think we have to act in good faith and it has long been our position that we believe that particular treaty head has not been used in the way it was originally intended. We agreed that health and safety provision in 1985 on the understanding that it would deal with matters of genuine health and safety affecting workers. What we have seen, most recently of course in the opinion of the Advocate General of the European Court on the interpretation of the working directive, we don’t agree with the remarks of the Advocate General, we don’t think that article should be a basis for action on working conditions that go beyond health and safety. That was not our understanding when we signed the article, it wasn’t our understanding when I reached the agreement on the Social Protocol at the Maastricht Treaty.

So I made it clear this morning that this is a matter that we will have to turn to afresh in the intergovernmental conference. I reached agreements at Maastricht, and we reached agreements on the health and safety article before, that must not be undermined and must be kept in good faith. And I think it will be extremely difficult if we are unable to reach agreement on that in the intergovernmental conference. I indicated this morning that I would be looking in the IGC for changes to Article 118A so that it reflects our earlier understanding of its limited scope. And the reality is that if old agreements are to be re-interpreted, it is difficult to see how we can reach new agreements in good faith. But I think it was overall a very constructive exchange of views this morning.

Both this morning and over luncheon we spent some time discussing the current problems in the beef industry. I set out this morning, and again over lunch, why some of the actions over the last week perhaps have made the problem worse. But we spent most of the time looking at the problem as it is today and how we actually deal with the problem for the future. We have already taken a number of steps to protect consumers and support the market.

I should emphasise at the outset that the scientific advice that we have is that beef is safe, safe for us, safe for other people, safe to eat. That is the view of the scientists. But the collective hysteria that we have seen over the last few days has raised a great question-mark in the minds of consumers of beef. And the principal issue that we now have to address is how to restore confidence in the mind of consumers rather than the specific action on health, for I repeat we believe that British beef is safe.

I think, and said to colleagues, that we need now to do three things. Firstly bring about the conditions in which the ban on British beef exports can be lifted, and lifted speedily. The United Kingdom has been meeting today, the Agriculture Minister has been meeting in Brussels today to try and identify with the Commission a package of measures that would enable the Commission to recommend lifting the ban.

I would hope, if agreement is to be reached, and some progress has been made today, talks will continue and I anticipate an agriculture meeting on Monday. Providing agreement can be reached I would hope partners would feel able to accept the Commission’s recommendations. And if that is the case, I hope colleagues will give appropriate guidance to their Agriculture Ministers when they meet on Monday. But I emphasise, the talks are proceeding, they are not yet concluded, they are likely to continue over the weekend, it is likely to move into an Agriculture meeting on Monday.

The second question we must address is the specific problem of the beef market, the beef market across Europe and the beef market in the United Kingdom. There was a universal recognition amongst our European partners today that this is not just a United Kingdom problem. This is a problem for the beef market across Europe. Consumption of beef has dropped in the United Kingdom, it has dropped here in Italy, it has dropped in France, it has dropped in countries right across the European Union. So we all have a collective communal interest in restoring confidence to the beef market, and also restoring the confidence of third markets to European beef as well as British beef. And that was the universal view of the colleagues that I have had discussions with today.

We have agreed that we need to look at the language of reassurance. I think everyone recognised that panic measures merely breed more panic. The scientific facts speak for themselves. British beef is safe, European beef is safe, and safe for the consumer on any normal definition of that term. And might say, for those people concerned about British beef, the Meat Hygiene Organisation that has responsibility for monitoring that have their own officers, in some cases more than one officer, in each and every slaughterhouse across the United Kingdom. And every slaughtered carcass is examined by someone from the Meat Hygiene Office, and I made that point very clearly to my colleagues this morning.

The last few days have left quite deep scars of course in the beef industry, quite deep scars in the United Kingdom and problems in other countries as well. Healing them is going to take some time, but I think we have made a good start today and I anticipate that my colleagues will have had something to say about that at their own press conferences.

In the discussion we had after luncheon, I was extremely reassured by the attitude taken by our European partners. There was support, without any qualification, from across the board amongst our European colleagues, support not just in a general sense but an indication that there would be support where necessary in a financial sense as well for the costs that will be incurred in dealing with this problem.

There was a recognition that communal action is necessary to restore confidence and I think all colleagues took on board the fact that as soon as we have agreed a package it will be crucial to restore confidence, not just in the United Kingdom, but across Europe, that that confidence is sufficient to lift the ban that was placed on British beef earlier this week.

So I think we have had some very constructive and worthwhile discussions today. I am grateful to my colleagues for the way in which they entered into those discussions, and I think we have set a good basis for carrying those talks forward over the weekend and into Monday.

QUESTIONS AND ANSWERS

QUESTION (Michael Brunson, ITN):

Prime Minister, we understood that Mr. Santer was suggesting that as soon as the Veterinary Committee has looked at and approved your measures then they would be prepared to lift the ban. Is that your understanding, that all they will really need to lift the ban is to be certain that you are taking the sort of measures which are acceptable to the rest of the Community?

PRIME MINISTER:

I think that is what the President of the Commission would like to see, I think you have interpreted his views correctly but of course, the Scientific Committee is composed of vets from the national countries and they will presumably have to make a recommendation to the Commission for the Commission to lift their ban so I very much hope that can happen speedily but I think we must wait and see what the attitude of the Veterinary Committee is. I believe there would be no justification for keeping the ban once we have reached agreement on a package that is acceptable to our European partners; I very much hope that will prove to be the case.

QUESTION (John Kampfner, Financial Times):

Prime Minister, you have criticised the speed with which the ban was imposed and you have spoken of collective hysteria. Do you believe there was any broader political motive in the minds of certain people, certain countries, certain institutions in the speed with which they imposed the ban?

PRIME MINISTER:

No, I don’t make that criticism. The reality is that the ban has an impact across Europe as well as here. One of our European partners made the point over lunch that his country had beef in a ship waiting off-shore that they wouldn’t take on-shore – not British beef but beef from another European country – so the reality is that the ban has impacted upon the confidence in beef not just from the United Kingdom but right the way across Europe and I think that point is recognised as a European problem and that is why everyone has a direct interest in dealing with it speedily and comprehensively and showing that Europe has confidence in Europe’s beef so that the rest of the world can have confidence in Europe’s beef as well.

QUESTION (John Palmer, The Guardian):

Prime Minister, I wonder whether you were in a position to indicate, in however general terms, to your colleagues the scale of the costs which could be involved in these measures that have been prepared over a number of years and whether in your opinion, roughly speaking, a 50-50 distribution of those costs is the ball park of the discussions that are taking place and whether the whole affair hasn’t led you to think again about the merits of the Common Agricultural Policy bearing in mind only a few weeks ago the Government was saying that the Committee didn’t need so much money for the beef intervention fund.

PRIME MINISTER:

No. I don’t think it has changed our general view on other matters and neither is it going to change the negotiating position of the United Kingdom or other countries in the inter-governmental conference. There are quite separate matters: there are questions of policy which are matters of principle between the member states and they will continue as they were before and here we have an emergency that has existed across Europe in other guises in the past; a number of countries – Belgium, Germany – mentioned the earlier problems there had been with swine fever and the extent to which the European Union accepted a communal responsibility and that is what our partners have indicated they will do on this occasion.

As to the scale of the problem, I don’t propose to put figures to it at this particular meeting. I do have a broad indication of figures, the President of the Commission indicated he did too and chose not to give them at the moment. I think we need to do a little more work upon that so I don’t propose to give you any particular figures.

As to the division of costs, of course the costs arise in different ways. Some things arise under European Union programmes and in that case part of the cost will be met by the European Union, part of it by the United Kingdom, part of it gets docked out of the United Kingdom rebate, there is a clear-cut and well-established mechanism and there are other areas that are for national cost and some where the European will share the cost. It is not possible at this stage to put a proportion to it.

QUESTION (Reuters):

Prime Minister, do you still believe some of the costs could have been avoided if they hadn’t tried to put the ban on so rapidly and do you think there have been any lessons learned by your European partners about how this was handled?

PRIME MINISTER:

I think our European partners were responding to a collective hysteria that broke out across Europe; they will express their own views. They will have seen the general views expressed for their public in their own countries and they have expressed some views about that; no doubt they will do that in their own particular press conferences and I will leave it for them to make their own points.

The fundamental point that is clear and is immensely distressing for the beef industry right the way across Europe – never mind just the UK – is that the view of the scientists was, is and remains that beef is safe, by any normal recognition of the expression beef is safe and yet because of the alarmism that spread across Europe, the people who are the consumers of beef lost confidence in the fact that beef is safe. The fact that that happened we can all look back to last week and attribute the blame in different directions but at this moment perhaps it is not particularly productive to do so. We could all look back and do that, so can you; you all know where to place your own version of the blame but the fact that this got out of control has now created a crisis that need not have been anywhere as large as it has become. There was a problem, it was a problem that I think could have been overcome with rational and sound judgement and appropriate measures – it spiralled out of control. I think all of us have lessons to learn about that when look at beef or health scares of any sort in the future whether in the United Kingdom or elsewhere.

One of the points made by more than one of my colleagues in discussion was that this particular health scare arose over British beef. Tomorrow’s health scare or next year’s health scare might arise in another European country and I hope all of us will learn lessons over how to try and damp down unnecessary hysteria.

The first point always must be a secure position on public health. Nobody can deny making public matters that relate to public health, that is proper and we did that but I think we must try and see how we can avoid this collective hysteria in future.

QUESTION (George Jones, Daily Telegraph):

Prime Minister, is the slaughter of the elderly animals which you have now decided will not be allowed to go into the food chain under active consideration and be part of the package which is considered by the Agricultural Ministers on Monday?

PRIME MINISTER:

We are looking at a range of issues at the moment in Brussels. Those talks are going on, George, as we speak so I don’t want to give out more information on them but there is a range of issues under discussion including that.

QUESTION (Sarah Holmes, The Independent):

Prime Minister, do you hold out any hope that the ban might be lifted as early as Monday or at least early next week?

PRIME MINISTER:

I can’t tell you the answer to that, I don’t know the answer to that. That will be a matter that will be decided after the agricultural meeting no doubt by the Standing Veterinary Committee who will make their own recommendations; it would certainly be my hope that it would be lifted speedily.

At this stage, we have several ingredients to deal with before we get there: firstly, we need to reach an agreement with the Commission; secondly, that needs to be acceptable to the member states; thirdly, we need the Agriculture Committee meeting and then we need to see what the Standing Veterinary Committee have to say but I do think it is in the interests of everyone to make sure that we reach a circumstance in which this ban can be lifted speedily because nobody should be under the misapprehension that this ban just ring-fences a problem in British beef – that is not the case. Whilst this ban remains, it is going to be seen by the whole of the world outside Europe as a problem for European beef and I think to that extent everyone has an interest in this problem being solved speedily so whether Monday or not I can’t tell you, as soon as possible I certainly hope so.

March 29, 1996
Mr Major’s Comments on Maastricht – 17 January 1996

Below is the text of Mr Major’s comments on Maastricht, made on Wednesday 17th January 1996.

QUESTION:

[Mr Major was asked to reflect on his thoughts when he went to negotiate at Maastricht in December 1991].

PRIME MINISTER:

We knew they were going to be very tough negotiations. At the back of our mind were several things. Firstly, we needed to deal with the fall-out from the Single European Act – that we were right to sign that in the 1980s – but some of the fall-out had been very difficult, the huge growth for example in Community Directives, and we needed to cut that back; that was the birth of subsidiarity, the idea of giving power back to the individual countries.

Beyond that, there were several over-riding themes in our mind. Firstly, we wanted to change the system whereby every development in the European Community added to centralisation, so we wanted to establish a system where some matters could be dealt with solely by agreement between the governments on a quite separate basis and that is eventually what we agreed on security, defence, foreign affairs and home and justice affairs, a wholly new way for the European Union to develop that no-one had conceived of before – that was important to us.

Beyond that, of course, there were some things we were not prepared to accept. We were not prepared to accept the Social Chapter because we believed it would destroy jobs and I still do, and I think the evidence shows that it does, and secondly, we were not prepared to accept a commitment to a single currency.

QUESTION:

[Mr Major was asked if he was on the defensive at Maastricht].

PRIME MINISTER:

In some cases certainly defensive but we had taken every detail of our negotiating position to the House of Commons and received the endorsement of the House of Commons so I had no doubt in my mind about the position that I was going to adopt and no doubt in my mind that if I was not able to achieve what I wanted, that I would not agree to the Treaty so to that extent I was certainly at ease in my negotiating position but there were a number of things that we wanted, those I set out a moment or so ago and a number of minor commitments as well all of which, in the event, we obtained.

QUESTION:

[Mr Major was asked if he knew at that stage whether he would be able to get an assurance on a British opt-out from the single currency].

PRIME MINISTER:

No, we didn’t have an assurance. I had had meetings with Delors, Lubbers, Kohl and others at the Luxembourg summit six weeks earlier and we had agreed a general principle of “no lock-out, no vetoes” so there was an implication that if we stood firm they would agree that there would be some form of opt-out but it emphatically wasn’t agreed and frankly, it wasn’t in my interest to have agreed it earlier because I wished to get the positive things we needed in the Treaty and also “out” the things we disliked before I came to the main issue of EMU. I didn’t want concessions made to me upon that issue that would have made the rest of my negotiations more difficult, I wanted that left till last.

QUESTION:

[Mr Major was asked how the opt-out was achieved].

PRIME MINISTER:

It was perfectly clear that I wasn’t going to accept the proposals that our partners had put to us. I thought then – and believe still – that it was folly for them to proceed as they did with a stated timetable and a commitment to go into a single currency, absolute folly. I wasn’t prepared to agree to that. Nobody would know years in advance that the economic circumstances were or the political circumstances and I just made it perfectly clear to them that if they wished to proceed on that basis, they could not expect Britain to do so and we would not and if they were not prepared to accept that, then there would be no treaty.

QUESTION:

[Mr Major was asked if this had been said at the formal conference part of the proceedings].

PRIME MINISTER:

I had made that clear at the conference session but there were a series of private meetings outside it. The conference session went on a very long time, it was much the longest European Council meeting that I can recall and from time to time everyone got rather tired. There were a lot of detailed matters to be discussed and I had some private meetings outside the conference hall with Ruud Lubbers, who was chairing it, occasionally with Delors who was Commission President, also with Helmut Kohl and others and some of those discussions took place in that form.

QUESTION:

[Mr Major was asked if he had tried to get every country an opt-out on EMU].

PRIME MINISTER:

It is difficult to persuade other people to accept something in their interests if they don’t wish to, but we would have preferred that, yes.

QUESTION:

[Mr Major was asked if could have vetoed the entire agreement].

PRIME MINISTER:

That is more theoretical than real, frankly. If we had vetoed the whole concept, they would have precisely what in the event they had to do with the Social Chapter and form a separate agreement outside the Treaty of eleven and that would have had the same practical effect with one difference – it would not have given Britain any influence about the economic conditions and other circumstances in which people might go ahead to a single currency and if they do go ahead at a future stage, whether or not Britain is part of that, it is going to have an economic impact upon this country, so I very much wanted us to be part of the negotiations and to determine the way in which this matter was structured in the years to come so I didn’t want it to be outside the Treaty in that sense.

January 17, 1996
Mr Major’s Speech at the Lord Mayor’s Banquet – 20 November 1995

Below is the text of Mr Major’s speech at the Lord Mayor’s Banquet, held in London on Monday 20th November 1995.

PRIME MINISTER:

First of all this evening, Lord Mayor, may I thank you and the Sheriffs for agreeing to move your banquet from its traditional date. I greatly appreciate your courtesy in doing so but I must tell you I spent most of last Monday evening hoping that none of you turned up here to an empty Guildhall!

This evening, I want to talk about some aspects of our nation’s future. I shall not this evening talk of Northern Ireland though I hope very soon to do so with the Irish Prime Minister and the mainstream political parties in Northern Ireland. Tonight, I want to talk about some of the ways in which the United Kingdom as we meet here this evening stands at a crossroads. In the next few years, we, must make choices, choices that may shape our country for generations. So far, debate on these has been limited, too often trivial stories dominate the news, too often the truth gets in the way of a good story. I believe the British public deserves better than that; they need to be told about the prospects and the problems that lie ahead; they need to have the options set out before them plain and unvarnished with common sense answers and in some aspects I will seek to do that this evening.

First, jobs and competitiveness. Today, the greatest challenge to our competitiveness comes from Asia and from China. The centre of gravity in world trade is shifting, shifting I think perhaps more rapidly than many people realise. Practically half the world’s people are emerging into vigorous industrial economies, they can offer new markets to us, they can offer new opportunities to us provided we are prepared to go out and claim them. But there is downside to those new opportunities because these new countries will also threaten to relegate an uncompetitive Europe to a far lesser role than it is privileged to play today.

My Lord Mayor, we have no automatic right to prosperity. We must earn it or we will lose it in the years that lie ahead. That is why it is my aim to turn Britain into the unrivalled enterprise centre of Europe. Let me discuss some of the wars we might make that aim a reality.

The heart of the matter is that there must be a limit to the share of national income that Government spend on behalf of the nation and there must be a limit to what they take from the nation in tax. Today’s fastest-growing economies have a very clear lesson for us: by keeping spending down, they have kept taxes down and low taxes are the best incentives for business to invest and this is our aim, the less we take in tax the more we can encourage enterprise. Enterprise means that employers can afford to employ people and effort is rewarded. That enterprise creates the living standards and funds the public services that we all care about.

In the mid-1970s, Government spent around 50% of our national income. We have brought that down to around 42% today, 10% below the average for the rest of the European Union. Because of the steps that we have taken to reform welfare and to encourage people to save themselves for their pensions, I expect that gap to widen further over the coming years. So we are doing quite well but not well enough. We cannot afford to compare ourselves with our European neighbours alone. Both America and Japan, crucial world competitors of this country, spend less and tax less proportionately than we do.

Our aim is to go further still and get public spending below 40% of national income and keep it there and if we are to do that we have to make tough choices between competing priorities. The State cannot – and in my judgement the State should not – try and do everything. We need to find new, more efficient ways of delivering public services and capital investment.

When the private sector takes responsibility and bears the risk, it is generally more efficient than the public sector. That, of course, is the underlying reason behind the Private Finance Initiative in which the City of London had such a vital role to play. Private finance already is a significant reality. By the end of this financial year, we shall have signed contracts under the Private Finance Initiative worth over £5,000 million. We are applying new ideas of private finance to one area of Government spending after another. It is already, of course, My Lord Mayor, well established in the Health Service for example where 25 schemes of over £25 million each are already in the pipeline.

Transport, crucial for the City and crucial for the country, is another rich area for private finance. I can tell you we have passed another critical milestone today. Subject to contract, we have selected the winning bid to design, build, finance and operate the upgrade between Newcastle and Carlisle. Another three major new road projects will follow, making a first tranche of £400 million and we have encouraging bids for a further four on top of that.

So private finance is not a passing fancy, private finance is here to stay; it will play an increasing part in capital investment in the future and I am determined to break down the barriers that currently have existed within Government for too long and enable the City to play the role that it has been denied from playing for far too long.

My Lord Mayor, an international enterprise economy is the only way we can offer lasting security and prosperity to our people. Free trade is in our blood, it is in the City’s blood and I believe that gives us a unique advantage as we look to the future. To make Britain the enterprise centre of Europe means pursuing our historic role as a global trading nation and that is why developing North Atlantic free trade and strengthening our links with Asia and Latin America are so crucially important to our own future but the market on our doorstep is Europe. Our task is to persuade the rest of Europe to take the enterprise road as well.

From next spring until probably the summer of 1997, the European Union will again be reviewing the treaties in an intergovernmental conference. Many of you feel, I am sure, that it is too soon after Maastricht for yet another conference. You might say that but I couldn’t possibly comment! So I don’t expect the intergovernmental conference to be a very wide-ranging review. I would like it to focus on specific areas where some modest improvements are attainable. We are already mapping out common ground with like-minded countries. Last month, President Chirac and I identified some areas where the conference should focus: a more effective common foreign and security policy; the reinforcement of subsidiarity, the right to have more decided domestically in host nations rather than at the European level; strengthening of the role of national parliaments and intergovernmental cooperation in the fight against crime and against drugs. These are areas where Britain and France aim to work together and where we also share much common ground with Germany.

These issues are important but they are not the great issues facing Europe at next month’ s summit in Madrid and thereafter I see three great issues: how to be competitive and to work; how to enlarge the European Union further across the Continent of Europe; and, of course, the implications for us and Europe of a single currency.

Let me turn first to competitiveness. Britain used to be seen by many as the poor performer. Today we have some of the most successful companies in Europe in steel, cars, electronics and we are attracting by far the bulk of foreign investment beyond Europe into Europe and from Europe into the United Kingdom. Britain leads the world in telecoms and media, we are in the vanguard of information technology and as we meet here this evening, we now have more of our people in jobs and fewer unemployed than any major European country, better than Germany and far ahead of other countries where employers are dragged down by high social costs.

The Social Chapter is not simply a set of principles, it is a set of policies which, whatever else their supporter may claim for them, add to costs and cost people their jobs. Nor is it a pick-and-mix option. The great bulk is decided by qualified majority voting; that means Britain cannot block proposals on our own even if we are opposed to them, there is no national veto and it is for those reasons that the Government oppose the Social Chapter.

We need here a climate where business – and perhaps especially small business – can prosper to create new jobs and to help business grow. If Europe competes it can prosper. It will be immensely damaging if Europe ignores the competition from the Far East. That competition is real. We cannot just pretend that it isn’t out there waiting to take our markets from us. To do so would be folly and if we were to do so, then Europe would surely get left behind.

So My Lord Mayor, if others in Europe bind themselves into uncompetitive economic and social structures, Britain will not join them. We are not going to put our economic success at risk and I shall take that message clearly and concisely to the conference in Madrid next month.

My Lord Mayor, too often and too simplistically that sort of message is taken as anti-European, nationalistic, seeing Europe as a trading area and no more. I say to you, My Lord Mayor, it is none of those things. I want Europe to succeed. We have gained greatly by being part of the European Union and there is a great deal more for this country to gain as a member of that great Union but I believe to maximise the benefits for us and for the rest of Europe it is right to set out the difficulties and to set out what needs to be done.

That brings me to the second question, enlargement of the European Union. I believe that we must spread stability and democracy across a wider Europe. Eastern and Central Europe have been the cockpit of war throughout the centuries but now we have an historic opportunity to bind them into a single market and the democratic embrace of Western Europe and if we are able in this generation of politicians to achieve that, we will bring for our children and our grandchildren a security and prosperity that our fathers and our grandfathers could only have dreamed of. That is the possibility that lies ahead of us and that is why enlargement of the European Union remains a vital objective. Europe has agreed this in principle, now it must face up to what it means in practice.

The problems are formidable. As Europe enlarges, the Common Agricultural Policy as it stands will be increasingly unaffordable. I put it mildly, reform will not be easy in the European Union of the Common Agricultural Policy but it is essential. The fledgling economies of Eastern Europe have already come a long way in a very few short years yet they will still need help to develop, still need help to survive alongside the competitive aspect of a free market in the single market of Western Europe but if help is to go to these newcomers, where will the help come from? How will it be accepted if some existing member countries of the Union are told there is less help for them or if other Members are asked for larger contributions to assist the new members? These issues must be addressed, they must be addressed if Europe is serious in its promises to Poland, the Czech Republic, Hungary, Malta, Cyprus and the other aspirant nations waiting to join the European Union.

Enlargement is complex enough on its own but at the same time we must grapple with an even more complex and politically-charged debate – the question of a single currency. Some are passionate about this, others have profound doubts. Britain, I am glad to say, has a choice. We can decide whether to stay out or opt in but whatever choice we make – in or out – one thing is certain: if there is to be a single currency, it will affect Britain and it will change Europe fundamentally. Not all members will join or could join. Only a minority could meet the criteria on the present timetable – a point I think that is now accepted right across Europe – but if some went ahead while others did not, the Union would be divided between those countries which adopted the single currency and those which remained outside it. In some areas of policy, such variable geometry may be sensible, indeed inevitable, but it needs to be thought through and so do its implications.

For instance, how would a single currency and the currencies or the rest of the Union co-exist? How would Europe’s institutions serve the interests of those countries which adopted the single currency and of those who did not? What would it mean for the Community budget? What would its implications be for the single market that has been of such benefit to every member of the European Union?

Attentive listeners will notice I did not ask what will be the name of the single currency; I left that question out because it is, to be frank, a convenient distraction from the issues that matter most and those issues must be answered before a single currency goes ahead. The price of error would be too high for Europe individually and collectively. This is something all of us, even the most enthusiastic advocates, need to consider. The time has come to answer these questions so that the Union can expand and reform successfully, so that stability and democracy are extended to millions more Europeans who are desperate to move from Central and Eastern Europe into the embrace of the European Union and to whom we have made a promise that in due time they will be welcome and they need to be answered so that Europe can compete with the rest of the world and win because our living standards today and our children’ s living standards tomorrow depend upon us successfully meeting that challenge.

Europe must not become an economic museum; it must and it can become a power-house and that is the purpose to which we must drive our policy and European policy as a whole. There is no point standing on the sidelines carping and moaning about things we don’t like. When I said we needed to be in the heart of Europe, I meant it for this reason: if we are in the Heart of Europe we can influence Europe, from the sidelines of Europe we cannot and we need that influence in Europe in the interests of every single member of this country.

My Lord Mayor, I said there were choices to be made. They must be made on the basis of a cool assessment and clear facts. Emotion is heady stuff but it often makes for poor policy. A cool assessment and clear facts is what we must look at and that is the basis upon which the Government will approach European policy, the only basis that is undeniably in the British interest.

These challenges are real, complex and often uncomfortable but they are at the centre of the choices that we face about our nation’s future; they must be addressed and they must be at the centre of our national debate and I, My Lord Mayor, intend to ensure that they are.

November 20, 1995
Mr Major’s Press Conference Interview in Majorca – 23 September 1995

Below is the text of Mr Major’s press conference in Majorca, held on Saturday 23rd September 1995.

PRIME MINISTER:

We came here this weekend without a set agenda, without pre-prepared positions, with the opportunity of having a look at some of the problems and opportunities in front of Europe over the next few years. And I have to say I think the meeting was all the better for not having been pre-prepared and not having large scripts in front of one on each and every subject that might be raised. I think we have had a much better, freer, franker exchange of views than I can recall on many occasions in the past. And by frank, I do not use that as a euphemism for rows. It has not been a bland meeting, it has been a very good meeting, but it has certainly been conducted in an excellent spirit on every side throughout the weekend. And I think that Felipe Gonzalez has had a very considerable success in calling this meeting and having so many things examined so thoroughly.

Let me just say very briefly a few words about the three component parts of the meeting we have had over the last day or so. Yesterday we spent the majority of the time discussing the challenges and the opportunities that lie immediately ahead of the European Union. The old slogans and the old prescriptions won’t do any longer. We are now coming to a position where it is not sufficient just to hold out an aspiration of doing this or that at some stage in the future. We are now reaching the position where clear-cut decisions will need to be taken on a whole range of things – enlargement, a little later the single currency, the financial perspective again at the turn of the century and of course the matter we discussed this morning, defence architecture and all the other matters that will be discussed in the IGC. I think most of you know what I had to say yesterday so I won’t bother to repeat it on this occasion, though I am happy to take your questions on it in a few moments.

Last evening over dinner we had a discussion that divided into three parts: firstly, a discussion on Russia, the internal position, relationship with the European Union, prospects for its future; secondly, a discussion on the Middle East, again its relationship with the European Union, prospects for the peace process in the Middle East, relationship with particularly the Palestinian authority, I think a number of people are very concerned about the difficulties that they face; and the third part of the discussion last evening was on Bosnia and the prospects for moving from the present position to a ceasefire right across Bosnia and then after a ceasefire a settlement, and then what would happen after the settlement.

No-one should assume that if we get a ceasefire and then a settlement that that is going to be the end of Western Europe or United States involvement in the former Yugoslavia, self-evidently it will not and we spent some time discussing those matters last evening. Again, rather than elaborate on a very complex discussion I will answer any questions you may have.

This morning I was asked to open a discussion on defence and security architecture in Europe, clearly an important part of the Intergovernmental Conference. Things have changed more dramatically, I think, than most people realise until they sit back and think about it over the last few years. Ten years ago, if we had met here, we would not have been discussing the future architecture of European defence, we would have been discussing the difficulties there were between East and West, SS20s pointing in one direction, Cruise missiles pointing in the other. So we have come a very great distance in the last 10 years or so, but we need to look at the problems that lie immediately ahead of us.

The fall of the Iron Curtain creates the prospect of re-uniting Europe and of enlarging our institutions, but it has also created quite a substantial arch of instability, from the north-east down to the south-east, from the Baltics to the Balkans. And those were the areas that we were actually discussing this morning and how we adapt to that new environment, how we extend and develop both the security and the prosperity that we have, NATO enlargement being a key part of that discussion this morning.

The over-arching objective, self-evidently, a Europe whole and free. Beneath that general aspiration a great many difficult and tricky decisions to be taken, some of them to be taken perhaps at the Intergovernmental Conference, others to be taken over the years ahead, bearing in mind always the sensitivities and the importance of Russia and also of course of the Ukraine. So those really are the areas of discussion we have been involved in over the past couple of days.

I should say also, in the high-ways and by-ways of those discussions I have had three separate discussions with the Irish Prime Minister, John Bruton, on circumstances and prospects in Ireland. It was not an occasion for us to come here and make clear cut decisions about what was going to happen in the immediate future. We have been looking at the present situation, trying to discuss the best way in which we might proceed. We have determined some ways that we may examine a little more carefully in the future. We have decided to look more carefully at what we have called Strand Three of the process, that is the relationship between east and west, between Dublin and London. And by and large we had a pretty satisfactory series of exchanges. I should just say, because people tend to think that whenever the Taoiseach and I get together we do nothing but discuss the peace process in Northern Ireland. Of course that is of great importance to us and we spent a great deal of time discussing it, but we also discussed other European Union and bilateral matters as well.

QUESTIONS AND ANSWERS

QUESTION (Robin Oakley):

President Chirac has indicated he wants to see the IGC concluded quickly, Chancellor Kohl has suggested it could well be delayed until the second half of 1997, taking it well beyond the next British general election. Which camp do you belong and do you fear that your veto has been weakened by the election timetable?

PRIME MINISTER:

No, I don’t think the British capacity to veto if we think it is necessary has been weakened, whatever the timetable may be. I am personally relaxed about the timetable. What concerns me is the substance of the discussions. We will have a clear cut British position on a range of matters and it matters not to me whether those matters are determined before the election or after the election, I am relaxed about that. But we have many complex matters to do. I don’t think this is going to be a very short and speedy affair, this Intergovernmental Conference, it has got a great deal to look at. It is not going to be earth shattering in its implications, I don’t believe. Many of the matters to be discussed are quite detailed, quite difficult, and they will probably take quite a while. But I don’t wish to put an artificial constraint, either a short term constraint or a constraint of delaying decisions to put it out a long way. I am relaxed. We will take the decisions when we are in a position to take them and the British position will not change, whether we are this side of the election or the other side of the election.

QUESTION (Judith Dawson, Sky News):

Going back to your meeting with the Taoiseach, are you confident that you will be able in the near future to announce the date of another summit?

PRIME MINISTER:

We did not discuss the date of another summit. I should say that the Taoiseach and I speak a good deal more regularly than most people realise and I would think our offices are probably in touch almost on a daily basis. I do not know when we will reassemble for a formal summit. But the lack of a formal summit will not stop the discussion and the developments going on, that will continue. As soon as we are in a position to have a summit, we will have one, but I do not wish to set a date for it today, and neither did we discuss a date at all over the weekend,

QUESTION (George Brock, Times):

You talked about the enlargement of both the European Union and NATO. From your discussions which of these two organisations would you prefer to see enlarged first and did you get any impression about which way it would happen?

PRIME MINISTER:

I don’t think anyone knows yet is the strictly accurate answer to that. I think both of those enlargements are going to proceed by stages. Anyone who thinks there is suddenly going to be a date upon which the European Union is going to dramatically expand, I think misjudges the complexities of expanding the European Union. The present intention is that discussions with the Visegrad countries, and possibly with one or two others, will begin 6 months after the conclusion of the intergovernmental Conference. So there is broadly a date, I guess, sometime by 1993 at the latest they will begin the enlargement discussions with them at that stage.

As far as NATO is concerned, that is not of course just a matter for the European Union and we did not discuss the specific timetable for the enlargement of NATO in detail over the weekend. But again, NATO I think will enlarge incrementally. There is not suddenly going to be a date upon which there is a huge and dramatic enlargement of NATO, that is not how I believe it will work. I think it will enlarge at a relatively relaxed speed and it will begin to enlarge from the centre of Europe, moving eastwards.

QUESTION:

You said just now that the negotiations with the Visegrad countries would begin 6 months after, is that an agreement that was reached here?

PRIME MINISTER:

No, that has been the understanding from a couple of summits ago, it is not a novel piece of agreement, that has been the working assumption for some time.

QUESTION (John Palmer, Guardian):

I was interested to hear that because certainly the other governments say the only formal agreement on 6 months is Cyprus and Malta, with the timetable for the others left open, but you say there is a political consensus that that will be the case?

PRIME MINISTER:

That is certainly my understanding, yes. My understanding is that we are going to start looking at this 6 months after. How soon they get in, of course, there is no agreement upon how soon they get in. But there has been very considerable pressure from the Visegrads to continue discussing and I hope we will be able to do it six months afterwards, and I have not heard anyone veto that, my understanding is they will be able to do that.

QUESTION:

Could you elaborate on how far you pushed forward the thinking on European security architecture and do you now envisage the very real likelihood that at least some East Europeans may find themselves in the EU and in the WEU before they are in NATO, is that now because of Russian attitudes more likely to happen.

And also, you are quite relaxed about the timetable for finishing the IGC and you say it will not make any difference to British policy, do you have the assurances of Mr Blair about that as well?

PRIME MINISTER:

I don’t need them, he won’t be here to discuss it. So I was referring to British Conservative government policy before the election and British Conservative government policy after the election, and I shall look forward to discussing it you on both occasions, both before and after the next general election. It is something we will both look forward to.

On the earlier point. It is not possible to say whether they would join WEU or the European Union before NATO, it simply is not possible to say. I certainly would not rule out that in some circumstances there would be an enhanced relationship with NATO before the European Union, but that is not a view we have agreed and discussed. But it is certainly possible that it will fall out that way. It is at the moment too early frankly to say.

QUESTION (BBC Wales):

In your bilateral discussions with Mr Bruton did you talk about the public concerns in Ireland and in Britain about the dangers from nuclear power stations?

PRIME MINISTER:

The question of WILFA [phon] was briefly mentioned but it was not a substantive discussion. Beyond that we didn’t, no.

QUESTION (Tony Bevins – The Observer):

Could you give us your assessment of the risk of allowing the deadlock in Ireland to continue for much longer please and can you also tell us what areas you are looking at with Mr. Bruton for breaking this deadlock?

PRIME MINISTER:

On the latter point, I don’t think it would be wise to go into that in detail at the moment.

On the earlier point of how risky is the deadlock, I think that too many people read too much into each setback and there is a great danger that whenever there is a setback like the postponement of the summit, up pops someone to say as surely as Christmas comes around every year that the process is in crisis and all sorts of dreadful things are about to happen. I have heard that before on a number of occasions and the reality that there is an undertow that all the politicians have to take account of whether they are British, Irish, Northern Irish, Sinn Fein, whoever it may be, and that is the huge undertow of public opinion in Ireland that wants this process to continue. No-one is readily going to be able to say they are going to stop this process without having to answer not just to history’s judgement which I think would be severe but also to the judgement of people today in Northern Ireland so when people jump up and say: “This is in crisis, the peace process is doomed!” and other nonsense of that sort, I think they are entering into their own negotiating position rather than stepping back and understanding the realities of what actually is going on at the present time.

I remain optimistic about the process. It isn’t going to suddenly produce a conclusion. Anyone who thinks that we are suddenly going to wake up one morning, rub our eyes and have a final agreement to the problems of Northern Ireland misunderstands both the nature of our discussions and the nature of the problem. The solution will evolve. You may notice movements as you go along, others you won’t but the changing perception of what people demand to which the politicians have to respond is continuing all the time and anyone who goes to Northern Ireland today and compares the atmosphere in Northern Ireland, the way of life in Northern Ireland, the economic activity in Northern Ireland, the aspirations in Northern Ireland to twelve or eighteen months ago will find a wholly different situation and frankly, this old-style oratory doesn’t help and we really ought to be looking together to find a way through the present setback and I will continue to do that. I know John Bruton will, I think many of the Irish politicians will as well in the north and I hope and believe we will find a way through.

QUESTION (Paul Meray – Reuters):

Are you concerned about comments from Gerry Adams that he feels the process could slip back into violence if there is not progress fairly soon?

PRIME MINISTER:

Who is going to be violent? Mr. Adams says it can slip back into violence; whose violence will it be? It doesn’t have to slip back into violence if Mr Adams doesn’t want it to slip back into violence, that is a matter that is in Mr. Adams’ hands and I hope he will tell us that it isn’t going to slip back into violence. It isn’t all that long ago that Mr. Adams was saying to us: “Violence is ending! We are on our way to a settlement!”

I don’t think this suggestion that you slip back to violence every time something doesn’t proceed at a rapid pace is remotely helpful. When Mr. Adams next says that, I suggest the people to whom he says it ask him: “Who is going to return to violence? Are you, Mr. Adams, going to return to violence? Are the IRA going to return to violence?” That is the question Mr. Adams needs to answer and on the basis of what Mr. Adams has been saying in the last year his answer to that question should be no and if it isn’t no, how does he explain all the things that he has been saying over the last twelve months?

QUESTION (James Mates – ITN):

Prime Minister, on a different subject can I ask you about Chris Patten’s remarks that Hong Kong British passport holders should be given the right to live in the UK. Do you agree with these remarks? Did he discuss them with you before he made them? Is it going to be Government policy?

PRIME MINISTER:

I haven’t seen the remarks and I will comment on the remarks when I have seen them and when I have discussed them with Chris. I have not seen them, I have been here, I don’t know when or how they were made or in what context so I am not in a position to discuss them at the moment.

QUESTION (Sarah Holmes – The Independent):

Prime Minister, has there been any progress at all in deciding what the name of the single currency should be?

PRIME MINISTER:

None whatever. It wasn’t mentioned.

QUESTION (Sarah Holmes – The Independent):

Can you tell us what your favoured thought is at the moment?

PRIME MINISTER:

No, I can’t. I haven’t given it any thought at all. The name of a single currency that may be some time ahead doesn’t frankly seem to be the most important issue. The most important issue is what are the implications of a single currency and I spend a lot of time thinking about that but I confess to you in the privacy of this meeting I haven’t spent a lot of time thinking about the name of the single currency yet and as I said, it simply wasn’t mentioned.

QUESTION (Robin Oakley – BBC):

Prime Minister, you have said that the European Union has got to accommodate itself to a world in which some members will be in a single currency and some will be out. What precise accommodations do you think are necessary?

PRIME MINISTER:

I am pointing out that the position of the European Union has changed and what I have said I have not said for the first time this weekend though it seems to have struck more of a chord this weekend. It is a message I have delivered elsewhere and to my colleagues in Europe on a number of occasions in the past.

Let us look at what most people think is a possible future. Many people will say to you that a small core of the European Union may be able to go ahead with a single currency in 1999 or perhaps a little later. Let us take as a base for discussion the belief that that might happen, that half a dozen might go ahead.

There are fifteen members now, half a dozen go ahead, nine don’t. Within ten years, there could be as many as twenty-seven members of the European Union. If six have gone ahead, what about the other twenty-one, what is the relationship between them going to be? What happens if one or other currency that is not part of the inner core devalues against the inner core? What do the inner core feel about that? They are very worried about that. Do they have a mechanism for dealing with that? They do not.

What happens about the fact that the inner core, might integrate more speedily than elsewhere? Have they considered either the political or the economic implications of that? The answer is they haven’t considered that.

What are going to be the circumstances in which countries not in the inner core might subsequently join the inner core? That, too, is undetermined.

What happens to the direction of structural funds and the determination of structural funds? If the idea of a single currency is that it would help improve integration and growth, are those countries going to make a greater contribution to the structural funds of the less well-off nations in the European Union that wouldn’t be sharing in that extra spurt of growth?

There are a whole range of other questions like that. I could spend twenty minutes listing for you the questions that have not yet been examined.

We know the aspirations for a single currency, people have set out what they seem to think are the advantages of a single currency but the realities of what it means, how it would be bought out, what its market impact would be, what it would do both to the political and the economic structure of the European Union have not been fully examined and the whole basis of it thus far is that the European Union has tended to move forward broadly together – easy when you have six members, less easy frankly with fifteen, almost impossible when you get to nineteen and then twenty-seven – and this is why for some time we have been talking – it is a dreadful jargon phrase and I apologise for it – about “variable geometry”. The concept that fifteen or nineteen or twenty-seven countries would move together on a broad front at a united pace in the same way, at the same time, with the same objectives simply isn’t economically or politically credible.

The European Union has to address all these questions and decide how it is going to deal with them and it was those questions and others that I put to my European partners in the discussion yesterday. It was not an attempt to cause a row, not an attempt to create a blockage in discussions; it was laying before them practical questions that will need to be examined in the near future and I am delighted to say that there was very general agreement that those matters did need to be examined before irrevocable decisions were taken.

QUESTION (Robin Oakley):

Could you ever envisage as Prime Minister leading Britain into a single currency in the period you would expect to be in that office?

PRIME MINISTER:

That begs several unknowns, Robin. Firstly, I think it is too early to say. I will look at the circumstances. As I have always said, I do not think a single currency is imminent. Some people believe it may happen for some in 1999 – well perhaps. I am not certain about that, I think there are very real difficulties that we British have been talking about for some time that have not yet been properly examined and I think the Monetary Committee discussions that have been taking place will begin to sharpen some of those difficulties so although there is an aspiration for 1999, I think at the moment that is what it is, an aspiration.

QUESTION (John Palmer):

Just a clarification on your last answer to Robin, Prime Minister. The Commission, as you know, are already looking at just the questions that you have raised with your colleagues today and their preliminary conclusions seem to embrace the strong view that non-participating countries, basically a minority of the fifteen, should remain committed to convergence irrespective of whether they are in and secondly, that exchange rate stability should be helped to be assured by a re-entry into a strengthened EMS for countries who choose not to participate in EMU.

Do both of those strike you as practical answers to the questions you raised?

PRIME MINISTER:

Let me take the three points:

Firstly, the convergence criteria. We invented the convergence criteria, it was British determination that got the convergence criteria into the Maastricht Treaty. The convergence criteria are first and foremost sensible and practical economic aims so of course people should continue to aim for the convergence criteria of low inflation and the other things that go with it. The answer to that is self-evidently yes.

On the second point, frankly, I would be very surprised if it was a majority of the fifteen that were able to move ahead in the first tranche going to a single currency. I wouldn’t be surprised, I would be absolutely dumbfounded if that turned out to be the case.

Thirdly, the monetary relationship between the inner core and the outer ring. One of the ideas that has been floated is that the inner core of course will be a single currency so within the inner core there is no exchange rate fluctuation, there is only the one currency. Outside, the proposition is that there should be a strengthened EMS in order to maintain the value of the external outer-ring currencies against the inner core. Well, a strengthened EMS didn’t turn out to be all that successful in the early 1990s! One of the problems that caused so-much currency turmoil then – and not only for the United Kingdom – was that the flexible Exchange Rate Mechanism that Britain entered became a more rigid Exchange Rate Mechanism as people moved towards the aim of a single currency – that was one of the problems.

Is it going to be attractive to the countries in the outer ring to find that they don’t have what many of them would perceive to be the advantages of being in the inner core but they would have the discipline and responsibility of having to maintain the same exchange rate against the inner core without the advantages of being a member? I wonder how politically saleable that is going to be in all of the countries outside the inner core. It is, again, a worthy aspiration but when you get down to the reality of whether it is politically deliverable in all the countries of the outer core, then I begin to wonder about its practicality and these are the matters that needed to be examined.

On the substantive point, the convergence criteria are self-evidently right, we invented them, we adhere to them. I have no doubt, if we choose to, we will be in an economic position to enter. I don’t have any doubt about that. I think we are entering into a future in which the inflationary psychology has changed and when we can look forward in the United Kingdom to a low-inflation future and a future of sustained growth and of course that will apply providing we follow sensible economic policies and the convergence criteria are precisely that.

QUESTION:

Do you think that might be practical [inaudible]?

PRIME MINISTER:

No, it will not.

September 23, 1995
Mr Major’s Speech to 1995 Scottish Conservative Conference – 12 May 1995

Below is the text of Mr Major’s speech to the Scottish Conservative and Unionist Association Annual Conference at the Royal Concert Hall in Glasgow on Friday 12th May 1995.

PRIME MINISTER:

Let me turn first to those Conservative councillors who lost their seats in Scotland last month and in England and Wales last week.

From my time as a councillor, I know how bitter defeat feels. I know the disappointment when a good local record is swept aside by national politics.

So let me say to them: you served local people ably and well. You served local democracy well. Your defeats were none of your doing. And I am proud of what you achieved.

There are two things we can do after such a defeat. We can grumble and be disillusioned.

Or we can fight back.

We can work to make sure that the councils our opponents won this spring come back to us at the first opportunity.

So we will keep an eagle eye on them.

We shall set up a “Council Watch” to see how they keep their promises. To see how they spend your money. To see how they put your council tax up.

We must put disappointment aside. Go out into local communities. Work. Work. Work. Begin now to prepare for the next elections. And when they come we will take back those councils, each and every one of them.

Politics is in a strange mood at the moment.

Curiously this is partly because we have won the battle of ideas and forced Labour to deny some of their ancient prejudices.

We’ve won the battle for an enterprise economy.

For individual choice. For consumer power.

We’ve defeated the old socialist ideas of state control and public ownership.

Of course, Labour still hanker for them in private. But in public they’ve been forced to claim that they disown all the values they once believed in.

All gone. The Socialist cupboard, we are told, is bare after the most comprehensive philosophical wipe out in British political history.

Well, I am a bit suspicious about that. Some changes, yes.

But if Labour could shed so easily the values they held for so long, how deep is their commitment to values they’ve lifted from us likely to be?

I’ll tell you. As deep as electoral convenience needs it to be. Labour know that the electorate wants Tory values. So they have an extraordinary election cry.

“We were wrong all the time. The Conservatives were right. But trust us to behave ourselves in future. Oh, and by the way, please don’t ask us about policies.”

We’re very generous hearted, we British, We always forgive sinners who repent and Labour is benefiting from that at the moment. But we’re also discriminating and I think people will ask “if they were wrong before, why should we believe they’ll be right in future?”

It’s a good question – and we’ll go on asking it.

The extraordinary thing about our Party is that, after 16 years in government, it is still fizzing with ideas.

In this week alone we have announced measures to:

– cut electricity bills

– make our Post Office more competitive

– and crack down on drugs

And before, the Commons rises for the summer we will:

– publish a Housing While Paper

– launch a major new national volunteering programme

– invite the first private Sector bids to run British Rail services

– announce a fares policy to help commuters

– publish a second Competitiveness White Paper

– consult widely on ID Cards

– and announce a bold expansion of nursery education.

We already have a range of ideas which will keep us moving forward for years.

But it is right for us now to discuss with you, the bedrock of our Party, what you want to see in the next Manifesto.

A Manifesto grown from our grassroots, as we build the next phase of Conservatism.

I came from the grassroots of the Party.

I know the wealth of talent and experience our supporters have to offer.

So I will be the first leader in our Party’s history to give every member in every constituency an historic opportunity.

An invitation to help shape the policies of the future.

I have already set up Policy Groups on more than 30 policy areas, chaired by senior Ministers, and including representatives of all parts of the Party. Their first reports will reach me by the end of June.

Now it is right to unveil the next stage of this unprecedented exercise in consultation.

From this summer to next spring there will be a series of discussions across the party and across the country.

Each discussion will be around the Five Themes set out last month:

– how to secure economic prosperity

– how to improve further opportunity and choice for everyone

– how to improve decent, commonsense values in law and order

– how to deliver first-class public services

– And how to build pride in the nation.

These discussions will be detailed and genuine. They will take place on an agenda which will be shaped by the work of the relevant Policy Groups.

I want Conservatives up and down the country to take part in this.

CPC groups – as ever – will form the core of policy discussion at constituency level. But we intend to involve as many party members as possible.

These discussions will be followed by Conferences here in Scotland, Wales and across England, where we can bring these ideas together.

The developing agenda – not detailed Manifesto points – will begin to be unveiled at next year’s Central Council Meeting in Harrogate.

I will play an active role in leading this process, together with all my colleagues.

The Conservative Party has always listened to the people.

That is why we were the first party to support the Right to Buy.

The first to introduce Trade Union democracy. The first to give parents the right to know about their children’s schools.

So we will begin this massive consultation exercise within our party, and then will broaden it to engage and enthuse the public as a whole.

So I am going to go out and about. To meet you, to talk to you and to listen to you.

To build a People’s Policy to bridge the gap between the doorsteps of Britain and the Corridors of Power.

I’m going to share with you the hopes I have for this country of ours. The problems we face. The opportunities we have. I’m going to talk about the long-term as well as the short-term.

And when we’ve reached a policy conclusion, I’m going to ask the nation for a majority sufficient to put it into operation.

I believe that the commonsense of Conservatives up and down the land is the best guarantee that we will enter the 21st century with the right policies for our nation’s future.

Let me turn to two or three of the five themes. First, policies to spread economic prosperity and security.

People feel secure when:

– their jobs are secure

– their living standards grow steadily year after year

– and they can be confident that their children will have a better future. I know of no-one who doesn’t want that.

But it doesn’t happen by magic.

If we’re really determined to build security and prosperity for all – as I am – then we must continue to build an enterprise economy. And to get that we must take the tough decisions to create it.

Sometimes they’ll be unpopular. Because it means resisting the clamour of every interest group for higher spending.

It means clamping down on inflation, however loud the protests. And it means cutting state borrowing, whatever the moans.

We’ve been doing that. And it is the right thing to do – and to do what is right, however, difficult, is not a bad creed for politics.

And, as a result, we can now look forward to the best and most prolonged period of economic recovery for decades.

This is no ordinary recovery. What we may be seeing – provided we can carry it fully through – is the reawakening of Britain as a growing economic power.

And before our critics scoff let me give them some examples.

When we came to office, Scotland was the home of dying industries, poor productivity and mass trade union power. Frankly, it was an economic mess.

Today Scotland is in the forefront of new technologies. Scotland makes more than a third of all the personal computers manufactured across Europe and over half of all Europe’s cash machines.

Scotland is attracting inward investment from companies in Germany, Japan, the United States and across the globe.

They are attracted here by the enterprise culture built by the Tories, the corporate tax structures, designed by the Tories, and our lack of the Social Chapter insisted on by the Tories.

Since 1980 Scotland has seen self-employment increase by two-thirds.

For the first time in decades, the United Kingdom is increasing its market share of exports.

And we are now paying our way in the world.

For years we looked enviously at the industrial competitiveness of Japan. So we attracted their investment. Now Japanese companies based in Britain are exporting their products from here back to Japan.

And now, just think about this. Today, when you put visible and invisible trade together, the UK is in surplus with Japan.

How many of us ever thought we would see that happen again? That transformation is remarkable.

And it’s been achieved by implementing the Conservative agenda of reducing burdens on business. Cutting back the power of shop stewards.

Getting Whitehall off the backs of our companies. Lowering corporate taxes. Resisting unnecessary regulations from Brussels.

And above all, by setting free the talent and skill of individuals right across this country. No serious observer can doubt these changes.

And yet the country had better be warned: every aspect of this transformation would be reversed in one term of Labour government.

We were told that by changing Clause IV Labour showed they were reformed: they no longer believed in nationalisation. At last, they were a modern party.

But what have they spent the last fourteen days doing?

Pledging themselves to reverse rail privatisation – even though it will produce lower rail fares.

Promising to end compulsory competitive tendering – even though it has saved council taxpayers hundreds of millions of pounds.

Threatening new controls on privatised companies – even though their increased efficiency has produced a much better deal for consumers.

And trying to block the privatisation of the nuclear industry – even though it will cut electricity bills right across the country.

What this shows is that there is still a yawning credibility gap between what Labour says and what Labour does.

Do real Labour honestly worry about the profitability of our companies at ward meetings in Govan and Monklands?

Do they agonise about the “insecurities” of the middle classes in Constituency Labour Parties in Tayside?

Do delegates at Labour Conferences rack their brains to propose new policies to help private enterprise?

Of course not. You only have to ask the questions to know the answer.

If they were really serious they’d stop supporting the Social Chapter.

They’d drop their ideas to force employers to recognise trade unions.

They’d abandon their commitment to a minimum wage.

They won’t, of course. Because their commitment to the market is skin-deep. Were they to be in government, their Party would resurrect the calls for Socialism.

Daily our warnings are being proved right.

We always said the minimum wage would be damaging to jobs. And this week has proved it

First the CBI made it clear that they believe that any minimum wage would destroy jobs, drive away investment and cripple our companies.

And now we learn of a huge row within the Shadow Cabinet.

John Prescott attacked Gordon Brown’s figures on the minimum wage.

Gordon Brown attacked John Prescott. So in the end, decisive New Labour could only agree not to publish a figure at all.

Let me help them out of their dilemma. A minimum wage would cost hundreds of thousands of jobs and hurt most those who are most vulnerable.

And that is why we believe it is wrong.

This little cameo creeping out from behind the mask shows how utterly unfit for office Labour still are.

They have ideas aplenty on how to make companies less competitive but none on how to help them win.

That is why, next time as last time, the economy will be an area where we will win – and win well.

I want to say a word or two about crime.

We’ve always stood for decent commonsense values and for strong law and order.

We’ve always stood by the police.

Our first thought has always been for the victim.

And we’ve always believed in tough action against crime, And we’ve backed up our views with votes in the House of Commons.

The battle against crime is constant. It’s never easy. It has to be fought consistently over years.

Tougher penalties. New crime prevention measures. More powers for the police. That’s what we have been doing.

The statistics show that crime in Scotland is falling. Good – but not good enough.

So we have introduced measures which will have a significant effect on the fight against criminality.

We are introducing a national DNA database to harness the advances of science against the criminal.

This may prove to be the biggest breakthrough in the detection of crime since the invention of fingerprinting.

From now on, those who break the law had better know that the best techniques of modern technology will be used to track them down.

Just one drop of blood or tissue or hair at a crime scene could be enough to identify and catch a criminal.

We have set up a national fingerprint register.

And in the next few weeks a national database of criminal records will go live to provide a valuable new weapon against convicted and persistent criminals.

From now on, if someone is arrested in Glasgow the police will be able to know immediately whether they have also been committing crimes in London.

And our new Criminal Justice Bill in Scotland will give the courts and the police a wider range of powers than ever before to catch, charge and convict criminals.

All these changes are designed to make our country safer and put more thugs behind bars.

But we have fought this battle alone without Opposition support. Where have Labour been as we have waged this war?

When we strengthened police powers to stop and search criminals, were Labour tough on criminals? No, they voted against.

When we gave the police new powers to deal with riots, were Labour tough on rioters? No, they voted against.

When we ensured that all prisoners serve at least half their sentences in prison, were Labour tough on prisoners? No, they voted against.

And when we passed laws to fight terrorists who bomb and maim the innocent, were Labour tough on terrorists?

Hazard a guess.

No, they voted against.

But most revealing of all, how did Mr Blair describe Michael Howard’s 27 measures to fight crime?

Measures to crack down on young offenders. Measures to tackle bail bandits. Measures to stop professional crooks running rings round the courts. Measures called for by the police for years.

Mr Blair called them “gimmicks”. Gimmicks.

Well, I don’t call them gimmicks.

The view I take of crime is quite straightforward. We are engaged in a war against the criminal.

In that cause we should put the rights of the public first and the rights of criminals second.

Most people are perfectly able to distinguish right from wrong.

If people break the law, they should not be excused.

They should not be pampered.

They should be punished.

That is what that people of this country expect. That is what this Party expects.

That is what I believe.

And that is what our policies will deliver.

Let me just say a few words about policy on Europe. Britain’s future depends on us getting that right.

The European Community gives our companies the biggest home market in the world.

It has brought peace to countries which had fought for centuries.

And it can increase the influence and prosperity of all the countries within it. It has many virtues.

So I want Europe to succeed.

But not at any price.

And not at the expense of the nation-state.

I am keen to co-operate with our European partners. But I will not deliver Britain to a federalist future.

At Maastricht I negotiated long and hard for two key opt-outs against total opposition from our partners.

Both were vital for our national interests. I secured them.

I removed Britain from the Social Chapter – making this country a haven for foreign investment, and giving our companies a crucial edge over their competitors.

And I reserved for us the absolute right to take our own decision, in our own time, about whether we join a single currency or whether we stand aside.

There has been some speculation in recent days about what will happen to those opt-outs at the next Inter-Governmental Conference.

So let me tell you.

Those opt-outs will stay. They are permanent.

And they are not negotiable.

In any discussion about Europe’s future, I will always consider Britain’s interests before I decide,

That is what this country expects. And that is what this party will deliver. Pride in the Nation is a phrase with a particular meaning here in Scotland.

We have a deep instinct as Conservatives. We care passionately about the nations of the United Kingdom. Our feelings are emotional as well as intellectual.

There is no other political party in the world whose history is so deeply bound up with the identity of one particular country.

You couldn’t translate the Conservative and Unionist Party to any other country. Yet for 300 years, it has given voice to the people of a United Kingdom.

I am proud of our Party. Of its history. Of its record. It has built Britain’s influence in the world.

It has defended our institutions and our freedoms from threats without and within.

It has worked unceasingly to spread decent values of democracy and push back the darkness of totalitarianism.

In a rough, tough world, Britain has a high profile – at the UN, in the G7, in NATO and in Europe.

We have real influence as we approach the 21st century.

So it would be a disaster if we of all nations imploded into nationalist divisions of our own.

Labour’s devolution policy is a shambles. With one speech last year, I forced a U-turn on regional assemblies in England. Since then, Ian Lang and I have asked a series of simple but important questions of Labour’s leaders about their ideas.

Questions like how much would it cost? They don’t know. What would happen to the Scottish Office? Difficult one, that. And what is their answer to the West Lothian Question?

Mr Blair said that “The answer to the West Lothian Question is the answer that we’ve always given”.

Unfortunately for him, they’ve never given an answer.

In that at least it’s consistent with the rest of Labour’s Scottish policy. There are lots of questions, but rather fewer answers.

Labour’s approach to devolution is as elusive as the Loch Ness Monster but a good deal more dangerous.

Nessie brings jobs to Scotland. Devolution would drive them away.

So, why do Labour support devolution? It’s a good question.

Not because they really care about the constitution of Scotland. If they did care, they would have found answers to these basic questions.

Not because they think it make Scotland more prosperous, they are tartan taxers. They accept that it would put Scottish taxes up – and they know that the Scottish business community think it would drive away investment.

No, the simple reason why Labour support devolution is just to lure votes away from the Scottish Nationalists.

Yes, they are ready to play with the very survival of our United Kingdom for party political advantage.

It is the most cynical policy of modern times.

There could be no clearer demonstration of the difference between parties which talk about convictions and values – and those who live them.

I scorn such cynicism. And I will never take any lectures from people such as these on the importance of principle in politics.

And what of the Scottish Nationalists themselves?

At least they have thought their policy through. It would be profoundly bad for Scotland but it is thought through.

They admit that if you fiddle with the powers of the United Kingdom Parliament you will ultimately destroy the unity of the United Kingdom itself.

The SNP aren’t Tartan heroes. They should be seen for what they are.

They are socialists. They are unilateralists. And they are politically extreme.

Their message is a contradiction of all Scotland really stands for. A denial of its historic role. Inward looking and introverted.

They thrive on negative resentment, the culture of criticism. They kick traditional institutions just to feel good. It’s a dangerous game to play.

The SNP’s approach boils down to one phrase. Socialism in one country.

It has never worked. It can never work. And our task is to make sure that it is never tried.

Scotland would pay a high price for independence.

Taxes here would soar and soar again.

Independence would be an unpriced menu.

But I do not rest my opposition to independence solely on that.

For Scottish independence would hurt not only Scotland, but the rest of the United Kingdom as well.

All of us – Scots, English, Welsh and Northern Irish – would find ourselves citizens of a lesser county, with a smaller voice in the world, and with less chance to influence our future.

So we are and will remain the Conservative and Unionist Party. We believe in the Union and in Scotland’s place in it.

I believe the Union is in the lifeblood of our party and our nation. It’s our duty to stand up and defend it. We won’t shirk that duty.

So long as I have heart and voice I will defend the Union against all who would weaken it.

In the interests of all our country some causes are bigger than the transitory rancour of politics. And this is one.

Those who would seek to marginalise Scotland must be defeated. And with the help of those in this hall they will be.

May 12, 1995
Mr Major’s Commons response to the Opposition Day on the European Union – 1 March 1995

Below is Mr Major’s Commons response to the Opposition Day on the European Union, held on 1st March 1995.

Madam Speaker: I have two short announcements to make before we begin the debate. First, I have selected the amendment standing in the name of the Prime Minister. Secondly, so many Members want to participate in today’s debate that I have put on a 10-minute limit from 7 o’clock; but I would hope that Members fortunate enough to be called before then will voluntarily limit their speeches. I want to hear as many voices as possible in this debate.

Mr. Tony Blair (Sedgefield): I beg to move, That this House does not support Her Majesty’s Government’s policy towards the European Union and does not believe it promotes the interests of the British people.

The case that we make today is that it is in Britain’s interests to be fully at the heart of Europe. So far from pandering to Conservative Members who may take a different view, let me say at the outset that I intend to try to deal with their arguments head on. Let me also tell our Ulster colleagues that I support the Government’s position on Northern Ireland and that that support will not change. The crux of this debate, therefore, is not the parliamentary arithmetic but the policy towards Europe.

At each stage I shall set out the Labour party’s position, and I shall then ask the Prime Minister to clarify the Government’s. Let us dismiss straight away, however, the bogey of some federal united states of Europe. The choice is not between a federal and a non-federal Europe. The true choice is whether Britain’s interests are best served by remaining at the heart of Europe, engaging constructively with further European co-operation; or by retreating to a different relationship altogether with the European Union. Both are logical and sustainable positions, but they imply quite different visions of Britain’s future.

At one time the position of the Government was clear. It was the Prime Minister himself who said, just a short time ago:

“It is absurd to believe that Great Britain would voluntarily separate itself from the mainstream of European development . . . Great Britain stands at the centre of Europe and will remain as such.”

Indeed, at an earlier stage he even said:

“There is no more important issue facing the European Community than the path we choose towards economic and monetary union. We are all committed to this goal. That is no longer news.”

Of course the right hon. Gentleman was right to want to be at the centre of Europe. Europe and NATO have given Britain and Europe peace. The single market, now combined with a proper social dimension, offers huge opportunities to British business. British businesses such as ICI, British Steel and British Telecom can only gain if competition rules are enforced across Europe. The European Union acts as a powerful magnet to inward investment. And British people–we support this–have been given rights: decent health and safety, equality for women, fair treatment for part-time workers. In our view at least they would gain more were we to join other Governments, Labour and Conservative, in the European social chapter. Britain has enhanced its voice in the world through Europe, especially in trade. It offers, therefore, a range of chances across a range of areas, from research to the environment to technology and infrastructure, to act and co-operate where the nation state is insufficient.

The question is: do the Government still believe that we should be at the centre of Europe in future co-operation, or has their position changed? That is the question in the debate.

Mr. Richard Tracey (Surbiton): Will the Leader of the Opposition clarify one point? In recent years, the party that he leads has changed its mind five or six times on its attitude to Europe, and in his time in the House he has himself changed his attitude to Europe several times. How can Europe or Britain take the Labour party seriously on the matter of Europe?

Mr. Blair: For those who do not know it, this is all set out in the Conservative research department brief. [Hon. Members:– “Answer the question.”] I will answer it. I would prefer to be leading a party that was anti-European and is now pro-European than leading a party that was pro-European and is becoming anti-European.

Mr. Norman Lamont (Kingston upon Thames): Will the right hon. Gentleman comment not just on his party’s position but on his own position and the views that he put forward in his election address in 1982 and 1983, when he actually stated that the EEC removed Britain’s freedom to pursue its own economic policies? Will the right hon. Gentleman tell us whether that reflected his own view and, if it did not, why could he not have pursued the course taken by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), who made no mention of the European Community in his election address?

Mr. Blair: I can think of no one worse to level the charge of inconsistency than the right hon. Gentleman, who took Britain into the exchange rate mechanism and the Maastricht treaty. With all due respect, he is the one who has to explain the changes–

[Interruption.]

I was asking whether– [Interruption.]

Madam Speaker: Order. That includes the Government Whips.

Mr. Blair: I was asking whether it was the case that the Government’s position of being at the centre of European co-operation has effectively changed. I think that it has and, with gathering force, the centre of gravity in the Conservative party is shifting and shifting fast.

Just consider it. The nine Whipless Tory Euro-rebels publish a separate manifesto calling, in effect, for withdrawal from the European Union. What was remarkable was not that document but the reaction to it. Almost immediately the Chief Secretary took to the airwaves to say that there was much common ground between the rebels and the Government. Not one single Minister condemned it. Indeed, at times over the past few weeks, the Euro- rebels have appeared to be almost like some alternative Cabinet. Perhaps in time they will be. Perhaps the fate that awaits the hon. Member for Billericay (Mrs. Gorman) is to become the Foreign Secretary in a future Portillo Government, or the hon. Member for Wolverhampton, South-West (Mr. Budgen) is to become the Chancellor in a future Government. At least, I suppose, that would mean that the top two economic spokesmen in the Government agreed.

Sir Patrick Cormack (Staffordshire, South): Will the right hon. Gentleman give way?

Mr. Blair: Later.

The former Chancellor of the Exchequer has said that we should contemplate withdrawal from the European Union. A former vice-chairman of the Tory party says that he wishes that we had never joined. Daily, there are fresh converts to that cause, most noticeably recently the right hon. Member for Brent, North (Sir R. Boyson). On Monday, another sceptic document was published. It was rewarded with a Prime Ministerial foreword no less, praising it as a lively contribution to the debate. The only people, apparently, who cannot debate Europe, are the Cabinet who have responsibility for it.

Lord Tebbit, Baroness Thatcher: their views are well known. I thought it most interesting that, at the Tory youth conference a couple of weeks ago, when the row was at its very height, not a single Minister was called to defend the pro-Europe position–not one. The Home Secretary went. What did he do? He pandered to them. There was no defence of the Union, no explanation of its benefits. One can tell a lot about a party from the buttons that the politicians press for applause.

There remains, of course, a group of pro-Europeans, but they are increasingly beleaguered. Indeed, Lord Tebbit, when asked whether the nine Tory rebels were not damaging the party, said, “There are nine MPs damaging the party, but unfortunately they are all in the Cabinet.” [Interruption.] They may wear the badge with pride, let us say.

The result of all that, at best, is immobility in policy, and, at worst, retreat. That is most clear over the single currency, to which I shall now come.

Sir Patrick Cormack: Is the right hon. Gentleman really seeking to persuade the House that he, surrounded by the hon. Members for Bolsover (Mr. Skinner) and for Great Grimsby (Mr. Mitchell), and by the right hon. Member for Bethnal Green and Stepney (Mr. Shore), leads a united party on Europe?

Mr. Blair: In my speech I shall deal specifically with the issues of division in both parties. But let me tell the hon. Gentleman what the difference is: my position is clear. Is the Prime Minister’s? That is most clear over the issue of the single currency. Let us remind ourselves: at the beginning of February, the Chancellor was calling for an open, sensible debate about the single currency and its merits. Is that not right? Within two weeks, such was the disarray that the entire Cabinet was asked to undertake some Trappist vow of silence. We are therefore in the extraordinary position that Ministers, including the chief economic spokesman of the Government of Britain, cannot speak on a vital issue of national importance.

Indeed, let me draw attention to the Secretary of State for Employment, who, the day after the injunction not to speak, attended a Rotary club lunch at the Marriott hotel. I read from The Times : “Mr. Portillo toned down his usual Euro-scepticism so much and refused to comment on so many points, that guests were forced into asking him questions about the food they were eating.”

Dr. John Cunningham (Copeland): They probably got better answers.

Mr. Blair: As my right hon. Friend says, they probably got better answers.

These issues do not demand to be suppressed. They demand to be answered and the principles governing them resolved.

Several hon. Members rose —

Mr. Blair: I have taken some interventions from one wing of the Conservative party. It is only fair to take one from the other.

Sir Teddy Taylor (Southend, East): As the Leader of the Opposition rightly pointed out, there are divisions on both sides of the House, as we well know. He accepts that the issue is important. He must also accept that people have changed their minds. Is the right answer, when we are very near the edge, simply to seek the views of the people of Britain as to which way they want to go? In a democracy, is not that the right way to go ahead, instead of throwing things across from one party to another?

Mr. Blair: I am coming to the referendum issue. I have already said that, if progress is made towards the establishment of a single currency, it must be made with popular consent, whether that consent is established by a referendum or by other means. I must tell the hon. Gentleman, however, that a referendum will not ultimately absolve the person concerned of the need to decide what his position is. A referendum is a means of obtaining popular consent; it is not a substitute for government.

The single currency raises three sets of issues–economic, political and constitutional. Let us take them in turn. In the context of the economic conditions, it is correct to say that if there were monetary union without real economic convergence, a single currency would be bad. If economies were locked together when they differed widely in strength and performance, unemployment in the weaker ones might result. If there were real convergence, however, a single currency could have benefits. That is the Labour party’s position–and, indeed, following his recent speech, it seems that it is effectively the Chancellor’s position.

The political question concerns the issue of popular consent. Again, some agreement is possible in that regard.

The key question, however, is constitutional. Is a single currency, as a matter of principle, inconsistent with our identity as a nation state? Does it imply a federal Europe? Is there, therefore, a constitutional barrier? If there is, we should not join, even if the economic conditions are right.

On that issue, many Cabinet Ministers have expressed a concluded view. The Chancellor of the Exchequer says:

“It is quite possible to have monetary union without political union.”

and again, in The Daily Telegraph , that a single currency is not

“a threat to the nation state.”

A few years ago, the President of the Board of Trade wrote: “No truly unified market can exist without a single currency. A close association of monetary policies will be needed if the single market itself is not to be put at risk.”

Those two views are quite clear. So is the view of the Chief Secretary to the Treasury, who said a few weeks ago:

“I don’t want to see a single currency, period, for as far as I can possibly foresee. I would hesitate for an eternity before I came out and said I would vote for a single currency.”

When asked whether he wanted a single currency, the Secretary of State for Employment replied, “No.” He said:

“A single currency is a long way towards political union. No British Government can give up the government of the UK. That is impossible.”

That could not be plainer either. No one would dispute, surely, that those views are diametrically opposed.

Mr. Nigel Forman (Carshalton and Wallington) rose —

Sir Peter Hordern (Horsham) rose —

Mr. Blair: I will give way in a moment. [Hon. Members:– “What is your view?”] I am about to say what our views are. There is no sensible halfway house, because although the economic issues may vary, the constitutional issue is clear as a matter of principle. It does not alter over time. The question is, given that Cabinet Ministers have expressed concluded views on the constitutional issue–although they differ–which of the two opposing views is the Government’s? That is what we need to know from the Prime Minister today.

I will put five questions to the Prime Minister. What is more, at the conclusion of each question I shall answer it and then ask the Prime Minister to answer it. I cannot put it more fairly than that. First, does the Prime Minister agree with his Chancellor that a single currency is not a threat to the nation state? I say that his Chancellor is right; I assume that he says the same. [Hon. Members:– “Answer.”] He cannot say.

Let me put this question to the Prime Minister. Does he agree with his Employment Secretary that having a single currency is a long way to political union, and would mean giving up the government of the United Kingdom? May we have an answer to that? I say that the Employment Secretary is wrong; what does the Prime Minister say? Thirdly–this is a question that he must surely be able to answer–

Mr. Lamont rose — [Interruption.]

Madam Speaker: Order. The right hon. Member for Sedgefield (Mr. Blair) appears not to be giving way; is that correct? In that case, the right hon. Member for Kingston upon Thames (Mr. Lamont) must resume his seat.

Mr. Blair: I shall conclude this passage and then give way to the right hon. Gentleman.

The Prime Minister has been unable to agree with either of those two Cabinet Ministers. If he is re-elected, can the Prime Minister say whether a single currency will be a possibility in the next Parliament, assuming that the economic conditions are right? It must logically follow from signing the Maastricht treaty that the answer to that question is yes. But what is the Prime Minister’s answer? Is it a possibility or not? He cannot say. Let me put another question. [Interruption.]

Several hon. Members rose —

Madam Speaker: Order. The right hon. Gentleman has said that he will give way later. Hon. Members should not persist.

Mr. Blair: Conservative Members say that this is not a quiz, but it is precisely to hold the Prime Minister to account that we called this debate. Anyone would think that I was asking the Prime Minister to do something quite extraordinary. I am merely asking him to agree with his Chancellor. We have a situation, do we not, where I as the Leader of the Opposition can agree with his Chancellor, but he cannot get up and agree with him.

The fourth question is that if the economic conditions were right, would the Prime Minister be in favour of persuading the country that it was right to join a single currency? He must be able to answer that.

Mr. Michael Fabricant (Mid-Staffordshire): Would you?

Mr. Blair: I say yes to that. Is the Prime Minister able to answer the question? With all due respect, that is the position of his Chancellor. That is what the Chancellor said in his speech a couple of weeks ago.

Finally, let me ask the Prime Minister whether he can agree with this statement:

“Some observers hope–and others fear–that economic and monetary union as set out in the Maastricht Treaty will be a step in the direction of a federal Europe . . . I believe that such hopes or fears are unrealistic.”

Can the Prime Minister agree with that? I can; can he? Shall I tell the House the author of that statement? It was the Prime Minister. That is the position to which he has reduced the Government. I find it odd that he cannot agree with his Chancellor, I find it strange that he cannot agree with his Secretary of State for Employment and I find it unbelievable that he cannot agree with himself.

The Prime Minister says that he cannot decide this constitutional issue now. But the point is that he decided it then. He was prepared to say expressly that it was not a step to a federal Europe. Now, of course, he cannot say. The truth is that this issue of constitutional principle is being postponed not because of circumstances that the Cabinet cannot foresee. The issue as a matter of principle is there: it is being postponed because the Cabinet cannot agree on it. Members of the Cabinet do not have open minds on the issue. They are not sitting round the Cabinet table wondering about the answer. They have the answer: it is just that there are two different answers for the different factions in the Cabinet.

Sir Peter Hordern: If the Maastricht criteria were met in full, would the right hon. Gentleman sign up to a single currency?

Mr. Blair: If the economic conditions are satisfied, the economic conditions that we have set out for real economic convergence; and if people can be persuaded on the necessary political consent–those are the two conditions–then I say yes. I also say that there is no constitutional barrier to joining. The question is whether that is the position of the Prime Minister. When the Prime Minister speaks, perhaps the right hon. Member for Horsham (Sir P. Hordern) will put the same question to him and see whether he can get a straight answer.

On this point I totally agree with the former Chancellor. He said the other day, and I think that he is right, that the issue of constitutional principle can and should be decided now. If, in truth, there is a constitutional barrier, such a decision makes a dramatic difference to our future foreign and economic policy. Not merely does it render void–indeed, in some sense deceitful–our participation in all the formulation of the institutions for monetary union, but it means that the whole of our future relations with Europe, the United States and others would change. We should prepare for that change now. It would be appalling to drift into a decision that there was, in fact, an insuperable constitutional barrier, without thinking through the consequences of that.

Let me take that one step further.

Mr. Lamont: Will the right hon. Gentleman give way?

Mr. Blair: No.

The Chancellor recently made a speech on the single currency, and spoke about its potential benefits.

Mr. Lamont rose —

Madam Speaker: Order. The right hon. Gentleman is a long-standing Member of the House and he knows that when another Member will not give way, he should not persist. I must ask him to remain in his seat for a while until the right hon. Member for Sedgefield is prepared to give way.

Mr. Blair: If I have time, I shall give way in a moment. Recently the Chancellor gave a speech about the potential benefits of the single currency. Could the Secretary of State for Employment make such a speech? Would he make such a speech? Of course not. Has he made such a speech? Of course not. Have the Chief Secretary, the Secretary of State for Wales, the Secretary of State for Social Security or the Home Secretary made such a speech? They are not people postponing the decision on a single currency; they are merely postponing the fight over which side wins. That is not in the interests of Britain.

Think for a moment that the Government were re-elected. Can anyone imagine the negotiations during the next Parliament and the state of our discussions with other countries in the run-up to monetary union? It does not bear thinking about. One day, our European colleagues may meet the Chancellor; the next day, the Chief Secretary; the day after that, the Secretary of State for the Environment followed by the Secretary of State for Employment. They would need not more interpreters but more psychoanalysts.

Precisely the same problems beset our attitude to the intergovernmental conference. The Government are driven, once again, to raise the phantoms and bogeys of a federal Europe. In fact, there is little support for co-opting the intergovernmental pillar on defence, for example, into the treaty. There is support, of course, for extending the role of the Western European Union. The IGC needs to make progress on closer co-operation on foreign policy and defence. We have long urged that the role of the WEU should be reinforced as the defence component of the European Union and as the European pillar of NATO. The WEU Heads of State and Government might meet at a WEU summit in parallel with the European Council. Those bodies could be strengthened. We do not favour a European army, but we can see a case for greater use of co-operation between European forces. That would be a modest but worthwhile step.

No one wants, or is suggesting that the Commission should run defence policy or that we should give up the national veto. There will, however, need to be change, primarily because of enlargement. A body of 20 members or even 15 is plainly different and requires a different form of decision making from a body of 12 or fewer. The Prime Minister said on the Frost programme that he would oppose and not countenance any extension of qualified majority voting. [Hon. Members:– “Hear, hear.”] I note the cry from the troops behind him. With all due respect, such a stand is absolutely foolish and not in Britain’s interests. [Hon. Members:– “Oh.”] Let me give hon. Members an example. On trade or the common agricultural policy, qualified majority voting is plainly in Britain’s interests; we do not want small countries to be able to block change that is in our commercial interests. Sir Leon Brittan made that very point the other day. A sensible policy would be to approach such issues, piece by piece, on their merits.

Perhaps most absurd of all was the attack launched on me the other day in an early-day motion signed by 100 Tory Members. They launched it because I am in agreement, on some issues, with Mr. Santer, the European Union President. Who is responsible for Mr. Santer? [Hon. Members:– “You are.”] I am, apparently. Next time, we may be responsible for the appointment of that President, but the Prime Minister was responsible this time. And why? For all the usual reasons. Mr. Dehaene was proposed, but he was then pilloried as someone who would impose a united states of Europe upon us. The Government panicked and opposed him. Mr. Santer stepped forward and was sold to us on the basis that he was something completely different. Literally within 48 hours, he was saying that his views were indistinguishable from those of Mr. Dehaene.

Is it any surprise that in those circumstances our credibility in Europe is close to zero, or our influence minimal? A Danish diplomat was apparently recently quoted as saying:

“When we saw Hurd last time, he could hardly say anything.” Or, according to Geoffrey Howe–Lord Howe, I should say–writing in the Financial Times :

“The ratchet effect of Euroscepticism now risks doing huge damage to British interests. For too many months, the debate on Europe within the Conservative party has been shifting destructively in the direction of disengagement and isolation.”

That is the view from all around.

Of course, there are differences over Europe in every party. In a sense, it would be a poor reflection on our democracy if there were not because these are questions of fundamental importance. It is right that politicians do not treat them lightly or regard them merely as matters of party, but the view of the Government must be clear. There may and will be debate as to what the policy should be, but there must be a policy. There is only one choice–to be at the heart of Europe or to be in retreat from it. Both are coherent positions, but they take the country in different directions. What is unacceptable is to have no direction at all.

In truth, the Government can have unity without clarity or clarity without unity, but they cannot any longer have both. Now is the time to decide. This decision is too vital to be pushed aside. In that I agree with the Thatcherites and the sceptics. The danger is that their view of Britain in Europe will prevail if it is not challenged. I challenge it, and I challenge it at its fundamental point. Recently, in a robust assertion, the Employment Secretary talked of what he called the defeatism of those who saw Britain’s future as lying in closer co-operation in Europe. I say that, on the contrary, what is defeatist is to believe that Britain’s identity is so fragile, its character so weak and its will so unimpressive that we cannot co-operate in Europe without destroying ourselves as a nation. I reject that view, and I say that this country should be and can be a leader of nations in Europe. That is its destiny. It should be leading in Europe and it can lead in Europe, but only under a different Government.

The Prime Minister (Mr. John Major): I beg to move, to leave out from “That” to the end of the Question and to add instead thereof: “this House rejects the policy of Her Majesty’s Opposition towards Europe, which would destroy United Kingdom jobs, erode the United Kingdom’s competitiveness in world markets, place new bureaucratic burdens on business and industry, destroy the veto and diminish the role of Europe’s nation states and their national parliaments.” In the 20-odd years since we joined the European Community, as it then was, our membership has always been controversial, so I welcome this debate to set out what our policy is, what the choices are and what those choices may mean for this country in the future. None of those choices is easy, none of them is without risks and none is without opportunities, but the belief that those choices are simple, and the belief that those choices can be made without a detailed examination of all their implications for living standards in this country, is not something that I accept. I shall deal with those choices in detail when I come to the question of a single currency later in my speech, as I promise the House I shall most surely do.

Some hon. Members on both sides of the House have always been instinctively hostile to our membership of the European Union. Others are uncritical supporters of the European Union, but most of us in this House–I believe on both sides of the House–believe that we are right to be in the European Union and that it is overwhelmingly in our national economic interest to be so but that we should be cautious about the way in which it evolves in the future. That is my belief and that is the Government’s position.

Over recent years, the benefits of the European Union have tended to be taken for granted and many of the negative aspects of the Union have been highlighted. The result has been that the debate over recent years has become more sour and public opinion has become more hostile than once it was to our membership of the Union.

I think that there are essentially three reasons why public opinion has moved in that direction. The first is that people fear, not only here, but out in the country, that some aspects of the Community have changed from the Community that we originally joined. Secondly, they resent in many cases what my right hon. Friend the Foreign Secretary has referred to as

“the nooks and crannies interference”

of the European Union. But, above all, many people fear the direction in which they believe the European Union may go in future. I do not believe that we would be wise to ignore those fears–I shall address them directly in a few moments–but I think that, to put them in a proper context, it is worth recollecting precisely why we joined the European Union in the first place. We joined it because it was in our national interest to join it. It was not idealism or romanticism and it was not just because it seemed an appropriate thing to do at the time. It was a hard-headed decision to join because we saw that membership meant jobs, investment, prosperity and potentially greater influence and would make a contribution to peace right the way across western Europe.

Mr. Donald Anderson (Swansea, East): Will the Prime Minister give way?

The Prime Minister: If the hon. Gentleman will forgive me, I shall make a little progress first.

The United Kingdom is perhaps more dependent on trade than any other large industrial economy. The European Union is the world’s largest trading bloc. We trade far beyond it, of course. We have interests in every part of the world, and they are growing interests. We are not dependent on the European Union, but it is a very large slice of our trade and very important to us. We are the world’s fifth largest importer and exporter and the Union now takes more than one half of our visible exports. The single market was fought for by a Conservative Government leading in Europe to change the nature of Europe from the heart of Europe.

The choice that the right hon. Member for Sedgefield (Mr. Blair) gave us on the future of Europe was only a partial choice about being at the centre. Being at the centre does not mean automatically agreeing with what everybody says. Being at the centre means fighting to move the European Union in the direction that we believe is right for this Parliament, as we did with the single market, as we did with enlargement, as we did with reform of the common agricultural policy, as we did with subsidiarity and deregulation and as we did with much else.

The single market offers huge opportunities to this country and we are taking them, in car exports, at record levels–

Several hon. Members rose —

The Prime Minister: In a few moments I shall give way to the hon. Member for Swansea, East (Mr. Anderson).

We are taking those opportunities in record earnings from financial and business services, in record levels of inward investment, which have led to more than 600,000 well-paid jobs in the past 16 years that we would not have had but for our membership of the European Union, and in record business and increasing business for the City of London. Nine out of every 10 European cross-border equity deals now go through London. Even the Deutsche bank has moved its foreign investment banking to London from Frankfurt.

Most important of all–a point often overlooked, but it ought not to be by a nation such as ours–the European Union, together with the NATO alliance, has delivered a prize without precedent to those of us in western Europe: 50 years of peace across Europe; the western democracies working together in world affairs to maximise their influence, and war between them made utterly unthinkable. They are huge benefits.

Mr. Donald Anderson: Accepting all that, does the Prime Minister agree that we did not join a static Europe, a Europe which will stand still? We joined a dynamic Europe and the choice for us is either to be part of that dynamism or to be moved into a second category, a second division. Is the Prime Minister prepared, by his negativism, to contemplate that for our country?

The Prime Minister: The hon. Gentleman could not have been listening. Of course it is not static. If we thought that it were static, we would not have been seeking enlargement. If we thought that it was static, we would not have promoted the single market. If we thought that it was static, we would not have changed the position on subsidiarity, deregulation and much else. If we thought that it was static, we would not be promoting the matters in the intergovernmental conference, which I shall come to in just a moment. The question is not whether it is static but what sort of Europe we wish to build in the future.

Dr. John Reid (Motherwell, North): Will the Prime Minister give way?

The Prime Minister: Let me refer– [Hon. Members:– “Give way.”] I propose to give way. If hon. Members will give me the opportunity to continue, I will make a little more progress. There will be occasions when hon. Members will wish to intervene on substantive matters. The often unspoken fear of many people–we should address it honestly and clearly and examine it–is that Europe might develop into a super-state, an overarching Government with no national veto, no control over our own borders, prescriptive decisions, a single currency imposed and the nation state retreating to a wholly subordinate role. That fear exists out there in the British nation, and we should recognise the fact that it exists.

I am sure that in Europe there are a few people who have ambitions for that sort of European Union; rather more people do not have any such ambitions for it. I for one would find such a Europe wholly unacceptable for this country. I do not believe that it is remotely likely, but, if that were to be the future, it would not be a future that would be suitable for this country.

In 10 months’ time, the intergovernmental conference will formally begin. The preparatory work begins earlier, but, in 10 months the conference itself will begin. Frankly, it is too early. It is too soon after the Maastricht treaty, and Governments right across Europe themselves know that it is too soon. The fact that it is too soon reinforces my view that there will be no majority for ambitious plans for centralisation in the intergovernmental conference. There will be no such plans because such schemes would not be ratified not just by the Government but by other Governments across Europe.

Dr. Reid: Does the Prime Minister agree that the timing of the IGC, whether it is too soon or too late, does not alter the fundamental question that he has refused six times to answer in past weeks and as late as yesterday, when he said that he would answer it today? Does he agree with his Chancellor that a single currency is not a threat to our nation state? Will the right hon. Gentleman now take the opportunity to agree fully with his own Chancellor or to dissociate himself from that statement, but, for God’s sake, go one way or the other and show some leadership?

The Prime Minister: I indicated a moment ago to the hon. Gentleman that I shall refer at length to a single currency, and I will deal with those issues in my own way at that time.

Europe’s pre-eminent task for the coming years will be further enlargement of the European Union–enlargement to bring in the countries of central and then eastern Europe, and to bring in Cyprus and Malta. I believe that that is desirable to spread the benefits not just of the free market further across eastern Europe but of security further across eastern Europe, and to discharge what I believe most people in this country would regard as our historic obligation to the people of central Europe who, in many cases, have suffered so much in the past half century.

That enlargement is now agreed. It is agreed overwhelmingly because of British pressure for that enlargement. What everyone recognises across the European Union is that a Union of 20 or more states–we can now foresee the date when there may be up to 25 or 27 members of the European Union–is bound to be more flexible and less prescriptive than the original tenets of the European Community when it began with a handful of nations. Unbending centralisation will simply not be feasible in a wider Union, and many of the fears that people have about it will be seen to be fantasy fears as the European Union develops.

Mr. William Cash (Stafford): My right hon. Friend refers to unbending centralisation. He is, of course, aware that the Maastricht treaty contains detailed recommendations–indeed, a legal requirement–for a central bank. What could be more centralising than that? If my right hon. Friend rejects centralisation, why does he not therefore make it crystal clear in principle now that he objects not only to a central bank but to the single currency that goes with it?

The Prime Minister: The hon. Gentleman knows of the position in the Maastricht treaty regarding a central bank. He knows that we have the option to decide whether to join a single currency at a later stage. As I said to the hon. Member for Motherwell, North (Dr. Reid), I shall deal with that matter in a few moments.

I shall speak first about the intergovernmental conference, which will begin in just a few months’ time. I do not believe that it will make huge changes in Europe. No one can be absolutely certain what our partners will bring forward, but I doubt whether any serious significant changes will be proposed.

However, the conference can and should usefully improve the way in which Europe operates, and we shall present a range of our ideas at the conference. We shall suggest ways of developing the common foreign and security policy, and ways of stepping up the fight against organised crime and terrorism. We shall set out ways of achieving a stronger role for national Parliaments, and more subsidiarity. We shall build on the steps agreed at the Essen summit to crack down on fraud.

Under qualified majority voting, a larger say should be given to the larger states, and we shall set out our plans for that. At the intergovernmental conference we shall also seek to reinforce the democratic authority of the Council of Ministers. For reasons that will become apparent as my speech proceeds, we shall not accept the end of the national veto, or significant constitutional change that would impact adversely on the House.

We shall argue that foreign, security and home affairs must continue to be agreed between sovereign Governments, and must not be collapsed into Community competence. On that basis they can, and in many ways they should, be expanded to the benefit of countries and people throughout the European Union.

Reform of the common agricultural policy is bound to feature, but not at the IGC, for it is not a matter for treaty revision. But it will inevitably happen before enlargement proceeds, because the present CAP is unsustainable as we move towards a larger EU. Europe does not have just one agenda, as hon. Members sometimes seem to assume. There is not one agenda set by others that this country must blindly follow or reject. That is the choice that the right hon. Member for Sedgefield tried to put before people, but it is a false choice. We have the opportunity to set out how we think the Community will develop, and there are areas in which the United Kingdom has led and will lead in future.

The right hon. Gentleman touched briefly on one central matter–the question of defence. The Western European Union, of which 10 European Union states are full members, is both NATO’s European pillar and the vehicle for European defence co-operation. The intergovernmental conference will review that arrangement and we shall make our own proposals. I have written today to the European Heads of Government about the way in which we might develop those ideas at the intergovernmental conference, and I have placed a memorandum in the Library.

The approach that we propose is both practical and intergovernmental. Some points are incontrovertible: NATO has been the most successful defensive alliance in history, it must remain the bedrock of Europe’s security and its capabilities should not be duplicated. However, we also need a stronger Western European Union so that European countries can take on their proper share of the burden and act effectively in situations in which the United States may not wish to be involved.

Our proposals fall into three parts. First, we must define the tasks that European countries could realistically take on themselves. The defence of member states and major combat operations will of course remain the task of NATO, but the WEU should be able to deal with lesser crises. It should be able to engage in support operations and handle embargo or sanctions enforcement, and it should be equipped for humanitarian operations of the kind seen in Rwanda, and for rescue missions such as the evacuations that we have twice undertaken in Yemen. [Interruption.]

Hon. Members want to know how the European Union will develop; they should listen and find out. Secondly, new arrangements are needed to mobilise European collective capabilities. A separate European force would be wasteful, and might diminish NATO. NATO has proposed that we draw on, rather than duplicate, its own capabilities. We agree that that should be achieved through the concept of combined joint task forces, which NATO developed last year. NATO’s resources would then be available on a separable–not separate–basis wherever that was necessary.

Thirdly, we need to take high-level decisions of policy and military action involving western European countries at summit level. That would keep co-operation on an intergovernmental basis, and not on the basis of Community competence.

Sir Nicholas Bonsor (Upminster): I am sure that the House would welcome closer alliances within Europe and closer collaboration in terms of Bosnia-style operations and in the development of our high-technological defence industry in projects such as the European fighter aircraft and the future large aircraft. Will my right hon. Friend allay the fears of hon. Members on both sides of the House that the Western European Union may be integrated into the European Union? Can he assure us that that will not occur, and that the Government’s capability to run our defences independently when required will be maintained?

The Prime Minister: I can give my hon. Friend both those assurances. It is necessary to co-operate on an intergovernmental basis, and it will operate on an intergovernmental basis. There is no question of the WEU being integrated within Community competence. It is precisely to make sure that that is the case that we have set out the proposals for greater co-operation, and that is the way in which, intergovernmentally, the Community will develop, not just in defence but on a range of other matters as well. That is the right way for European co-operation to develop.

Let me now turn directly, and at length, to a single currency. I say at the outset that I still believe that Europe would have been wiser in its own interests to proceed first with a parallel currency–a common currency– which could have circulated alongside national currencies. It would have had the advantage of being market driven and, in my view, would have been far more likely to deliver worthwhile economic convergence. I believe that it was not wise not to proceed on that route. I still believe that Europe may find itself being forced to return to that route as it faces up to the necessity of economic convergence–which, when one comes to seek it, will not be easily obtained across Europe even among a small number of nations– and when it faces up also to the sheer technical difficulties of introducing a single currency. But we will see what Europe decides as it approaches the possibility of a single currency.

As far as a single currency is concerned, I reiterate today what I have made clear before. Britain will not join a single currency in 1996 or 1997 and, frankly, I increasingly doubt whether anybody will be ready to do so. Europe is not ready for it, and the sooner that is universally recognised, the better. I see no chance whatsoever that the economic conditions set at Maastricht, or the other economic conditions which are also necessary, will be met, and I see no one suggesting that they should be weakened at present.

Quite apart from the other arguments, the economic conditions are absolutely crucial to the success of a single currency. If a single currency were used to bind together artificially countries which were not marching in step economically, the strains upon the economies of Europe would be immense and unsustainable. I have been making that clear since 1990, and I am glad that the Opposition have finally caught up. That is relevant. [Interruption.] I was saying that while the Leader of the Opposition was still saying that he did not want to be in Europe. Those economic points are relevant– [Interruption.]

Madam Speaker: Order. The Prime Minister is on his feet. He knows that hon. Members are attempting to intervene and I am sure that, if he feels so inclined, he will give way, but it is up to him. He does not need help or indications from Opposition Members.

The Prime Minister: That is relevant because there are huge differences between the European economies. Italy, Sweden and Belgium have Government debts that are at or above their annual national income, whereas in Britain, Germany and France the ratio is only half that. Unemployment is 24 per cent. in Spain, 15 per cent. in Ireland and 12 per cent. in France, whereas it is 9 per cent. in Germany, 8.5 per cent. in Britain and 7 per cent. in the Netherlands. There are also big differences in labour market flexibility, which may leave some countries poorly placed to respond to the shocks that would inevitably occur in a single currency in future.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley) rose —

The Prime Minister: I will give way in a moment.

There is a large body of opinion across Europe that believes that a single currency could proceed around the turn of the century. Clearly, all 15 members of the European Union could not join such a single currency around the turn of the century–there is no chance of the economics being right– but a core group of countries could conceivably be ready to go ahead then, a small group of nations that, economically speaking, could include the United Kingdom.

If that core went ahead, it would radically change the nature of the whole European Union. At this stage, no one can safely predict what that would mean for those within the core and, equally important, what it would mean for the majority of members of the European Union, who would remain in the Union but beyond that core number of nations.

Mr. Iain Duncan Smith (Chingford): My right hon. Friend clearly laid out where the real problems in the convergence criteria lie, should people try to move down those roads without following them correctly. Furthermore, he pointed out that those are essentially good management techniques. Surely the key factor is that the real problem lies in establishing a timetable that makes people drive to a point that they might not have arrived at naturally. Does he agree that at the 1996-97 intergovernmental conference we should do our level best to take out the timetable mechanism completely and to leave it so that countries may or may not converge?

The Prime Minister: My hon. Friend is entirely right that the timetable is arbitrary but, under the provisions of the Maastricht treaty, the economic criteria set out in the treaty supersede the timetable. If those are not met in 1999, 2009 or 2019, the provisions of the Maastricht treaty are such that no one would proceed. That is not merely the view in this country–it would certainly be the view of the Bundesbank or others.

Mr. Lamont: Does my right hon. Friend agree with Mr. Paul Volcker, the former chairman of the American Federal Reserve Board, and my right hon. Friend Lord Lawson of Blaby that monetary union inevitably means political union, or does he agree with the Chancellor of the Exchequer that it is possible to envisage monetary union without political union?

The Prime Minister: No, I do not– [Interruption.] With one important qualification: I believe that it is possible to move forward to monetary union without necessarily moving forward to political union, but the qualification depends on the nature and style of monetary union and I will deal with that in a moment. If the core went ahead, it would need to determine very carefully what that would mean for the rest of the European Union. To consider whether we should join that core at some future date means that we should consider the practical implications of joining it and, equally important, the practical implications of not joining and letting other nations go ahead without us.

Let me set out in detail what those implications might be, because I believe that both this House and the British nation concerned in that argument beyond this House need to know the practical implications of what going into the Union or staying out of it would mean for them, their political institutions and their economic future.

Mr. Tony Benn (Chesterfield) rose —

The Prime Minister: First, I shall give way to the right hon. Gentleman.

Mr. Benn: I listened carefully to the Prime Minister’s arguments about the possible effect on the Union of two tiers, but has he turned his mind to the effect on the domestic democracy of Britain if two fundamental principles that have existed over many centuries are broken: first, that there is a route through the ballot box for electors to choose the policies and laws under which they are governed and, secondly, that no Parliament can bind its successor? If the right to tax, borrow and set interest rates is transferred out of this country, we face the serious danger that people will lose confidence in the ballot box as an instrument for remedying the problems that confront them.

The Prime Minister: It is an interesting illustration of the unity on the Opposition Benches to have had that point put to me by the right hon. Gentleman.

On his first point about a two-tier Europe and its implications, I think that, with respect to the right hon. Gentleman, he oversimplifies the position of the two tiers. What we are seeing develop–it is not new but has been developing for some time and will accelerate–is not just a first and second tier but a much more flexible European Union that does not base itself simply on one tier or two tiers but is wholly flexible across a range of subjects. That is bound to become more necessary as the Community gets bigger. Frankly, it is both unrealistic and impractical to imagine that 15 nations–soon to be 19 and, within a decade or so, up to 27–will operate inflexibly on the basis of rules determined entirely centrally. That simply will not happen in the future.

Let me consider what it would mean if we were to decide that we were to go into a single currency at some future stage. If we were to join, we would need to lock exchange rates with other members; agree what the single currency should be–perhaps the ecu; and possibly abolish the pound and the Scottish and Northern Ireland pounds. I say “possibly” because–

Mr. Brian H. Donohoe (Cunninghame, South): Oh no, no; you cannot do that.

The Prime Minister: When I referred, a moment or so ago, to some of the practical implications of moving towards a single currency, I had not expected, in trailing my coat, that I would get such a splendid response from the Opposition. But the reality is that one can see the turbulence and difficulty of moving forward in that direction. The relevant difficulties in terms of absorbing the Northern Irish pound and the Scottish pound and just having the pound sterling are absolutely trivial compared with the difficulties of replacing sterling with a single currency across 15 nation states, so perhaps the large number of Scots in the shadow Cabinet might address their minds to the possible–

Mr. John Home Robertson (East Lothian) rose —

The Prime Minister: Ah, I shall give way to a Scot.

Mr. Home Robertson: Can the Prime Minister grasp the fact that Scotland and England have had a single currency since 1707?

The Prime Minister: That is because Scotland and England are part of a single Union, and I am determined that they will stay so.

Mr. Alex Salmond (Banff and Buchan): Surely the question at issue is: could Scotland and England currently have different currencies and still be part of a single Union?

The Prime Minister: If the hon. Gentleman recalls what I just said, he will know the answer to his question.

Let me reiterate the changes that need to be made. They are: locking exchange rates, agreeing a single currency, abolishing domestic currencies, making the Bank of England independent and passing control of interest rates and monetary policy as a whole to an international bank, on which this country would be represented as one among many. Those are the practical implications of going forward to a single currency, and the House and the country should be aware of them.

In addition to that, we should accept the possibility–perhaps even the likelihood, although no one can be certain about that–that a unified monetary policy would require a far greater alignment both of spending and of tax rates. If the House were to proceed with them, such changes would be the most sweeping changes in fiscal and monetary management that the House, with its history of control of supply, had ever considered and accepted in all its long and proud history.

The House knows, from the Maastricht negotiations and the opt-out that I negotiated there, that I am wary of a single currency for those economic reasons–wary of its economic impact and of the serious political and constitutional implications. However, if some of our partners do go ahead, there will be implications for this country in any event, albeit different ones. There is no way in which we can sit out that argument without affecting us in one way or another.

If we go in, we shall have the changes that I have set out, but if we stay out there are other serious implications to consider, and I shall spell them out to the House. No one at the moment can be entirely certain what the implications of staying out might be. We cannot know what the impact of a single currency might be on the pound sterling if the pound were outside it. We cannot know what the impact would be on the reputation and work of the City of London as the pre-eminent European centre if we were outside a single currency. We do not know what the impact would be on domestic or international investment in this country if we were outside a single currency, and we cannot know what the impact would be on employment.

Crucially, no one can possibly know at this stage the way in which market forces would react to the decision either to go in or to stay out of a single currency.

Mr. George Stevenson (Stoke-on-Trent, South) rose —

The Prime Minister: If the hon. Gentleman will forgive me, I shall make a little progress.

The purpose of spelling out those implications is to communicate the fact that at the moment those matters are necessarily unknown. They will become clearer as we move towards the point of decision; that is beyond doubt. We shall be in a position to know more of those. However, as of this moment, the answer to those questions cannot possibly be known, except as a matter of hunch. It is for that reason that I believe that it is in our own national and economic interests to keep open the option of going into a single currency– [Interruption] –and equally to keep open the option of deciding that it will not be in our national interest to go in.

Several hon. Members rose —

The Prime Minister: I shall give way in a moment to the hon. Member for Stoke-on-Trent, South (Mr. Stevenson).

I make no apologies now, nor will I in future, for deciding as an act of policy, in the interests of the country, that we should not make such a decision without the facts at our disposal to know the right answer. If a future Government decide to go ahead, they will need the consent both of Cabinet and of the House. They may also need the consent of the country in a referendum because, as the right hon. Member for Sedgefield said, we shall need to carry the opinion of the country with us, whichever way we proceed, but most definitely if we decided that we were to go into a single currency.

If a decision of great constitutional significance were to arise over a single currency or, for that matter–although I do not for a moment expect it to be the case–from the intergovernmental conference, a referendum could be necessary; it could be desirable, and I am prepared to keep that option open.

Mr. Stevenson: The Prime Minister has expressed his caution about entering a single currency, but will he answer a question? If the conditions are right and if the criteria are met, would he then agree to join a single currency–yes or no?

The Prime Minister: I do not know where the hon. Gentleman has been for the past 10 minutes–he has clearly not understood a single word. No wonder he is in favour of going in: he does not understand the implications of going in or staying out.

Mr. Tony Marlow (Northampton, North): My right hon. Friend has said categorically that we will not seek to enter the single currency in 1997. He will know that article 109j of the Maastricht treaty states that if we were to join on 1 January 1999 there would be a two-and-a-half year lead time. That means that, to keep the option open, we should have to join the exchange rate mechanism by 1 July next year. Is it conceivable that my right hon. Friend would put such a proposal before the House?

The Prime Minister: I certainly do not anticipate joining the exchange rate mechanism in the lifetime of this Parliament.

Mr. D. N. Campbell-Savours (Workington): The Prime Minister would have us believe that he has not made up his mind and that he wants to leave his options open. Does he not understand that what we object to is the fact that he is prepared to tolerate the activities of members of the Cabinet who have made up their minds? They are saying no, no and no again. How long will he put up with that dissent?

The Prime Minister: I think that the hon. Gentleman will find, when we get to 10 o’clock tonight, that the line that I have set out for the Government will receive the consent of the Conservative party–he need not worry about that.

It is important over the next few months that people understand what this debate means. In recent months–from time to time in this House too–far too many people have been playing off against one another as supporters of Europe, opponents of Europe, nows, nevers, wets and drys and those who have been implacably for or against a single currency. Every phrase has been analysed, every nuance noted, every speech dissected to see whether it represents a shift in one direction or another.

I must tell those concerned that such an artificial tournament is nonsense. I passionately believe that the freedom of choice which I obtained at Maastricht must be fought for and held in the interests of this country. It is by far the best vantage point from which to conduct a single-minded and successful campaign for our national interests in the European Union.

We are going to maintain the option because the decision that may have to be taken will be the single most important economic decision to face this country this century. To take it at long range, without knowledge of the circumstances, without knowledge of the daily details, without an examination of what is happening in the markets or without anything else besides would be folly in the extreme.

Mr. James Molyneaux (Lagan Valley): May I gently chide the right hon. Gentleman for his failure to thank the Leader of the Opposition for his assurance that in the lifetime of this Parliament the Government will not be defeated–unless, Madam Speaker, you are invited to discount nine votes?

May I return the Prime Minister to the point about sovereignty, which he may touch on later? It was always clearly understood that there would be a pooling of sovereignty by all the member nations. May I ask the Prime Minister for an assurance that there will be no horizontal transfer of sovereignty to any other member state on a bilateral basis?

The Prime Minister: From the moment we entered the European Community–now Union–there have always been areas in which we have pooled sovereignty and also to some extent lost sovereignty. But we also gained sovereignty over the actions of some other nations. There have been semantic arguments about that question, but it is a fact that there has been a pooling of sovereignty in some areas. That has not applied to issues of great national concern, and I do not believe that the concerns which clearly activate the right hon. Gentleman are ones that he need worry about. I do not believe that we are going to face the difficulty that he envisages.

I come now to some of the related fears about the Community that I mentioned earlier. Let me address directly some of the fears that people have.

Mr. Blair: The Prime Minister was describing what he saw as the balance of economic advantage one way or another which would progress over time, but if, over time, the balance of economic advantage is, in his view, in favour of entering a single currency, is he in principle in favour of doing so?

The Prime Minister: It is a matter of practice, not principle. What matters– [Interruption] . It is a serious point. The right hon. Gentleman asks a serious question and he deserves a serious answer. What is relevant is what the practice of entering would mean for Britain– [Interruption.] Of course, predominantly, in economic terms. We have to make a judgement about what is in the national interest. I repeat what I have said in the past. If I reach a decision that it is in the national interest to stay out, I will stay out. If I reach a decision that it is in the national interest to go in, I will recommend to Cabinet and the House that we go in. But we cannot reach such a decision without having the information in front of us; the right hon. Gentleman has done so. I decline to do so as an act of policy because I believe that we need to make that judgement when we have that information before us.

Mr. Blair: Will the right hon. Gentleman now say whether he sees a constitutional barrier to it? Does he agree with the Chancellor of the Exchequer that it is a threat to the nation state or not? Now let him answer.

The Prime Minister: The right hon. Gentleman is trying to tie this up into tiny little parcels. It is a serious point. What is relevant is what the whole package means for the House, the country and our future. If the whole package says that it is in our interests to go in, we go in, and if the whole package says that it is not, we stay out. But there is no point dancing round semantically on these points. At the end of the day, the only thing that matters is the British national interest. We cannot judge that except in the round. We cannot judge that until we have all the information available and we know the consequences of going in and the cost of staying out. I come now to the fear that I mentioned earlier that many people in Britain have–whether there will ever be what some refer to as a European super-state. In the sense of a European Government, I believe not, and personally I would prefer to leave the European Union before I accepted a European Government, but the degree of integration in Europe is a matter of dispute, not least between Government and Opposition in the House.

Upon some things we are agreed. The Government are not prepared to lose the border controls that we have at present and the Opposition have said that they will support us in that. I hope that that proves to be the case. In any event, particularly to protect our improved race relations, we are not prepared to weaken our immigration and other controls for non-European citizens. The Heads of Government across Europe pledged their word on that years ago and we expect them to keep it. We shall take whatever steps are necessary to that end. The right hon. Gentleman accuses us of divisions. He should look behind him a little more carefully before he levels that charge at us. We know what he has had to say about his Members of the European Parliament, but what is his attitude to his nearly 60 hon. Friends who opposed the Second Reading of the Maastricht legislation? What is his attitude to the 40 who rebelled against his leadership over the European finance legislation?

What is the right hon. Gentleman’s attitude to the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), who believes that

“the nation state is outdated”

and wants us to

“accept the increased jurisdiction of a centralised European authority”?

Does he agree with his right hon. Friend the Member for Copeland (Dr. Cunningham), who said:

“I personally am in favour of a single currency”?

Or does he agree with his right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), who says:

“I am not a fan of a single currency”?

Not only is the Labour party divided, but the right hon. Member for Sedgefield failed to explain all the aspects of Labour’s policy. He promised to, but he failed to keep that promise. I am not prepared to give up Britain’s national veto. I am not prepared to give up the right to say no.

Mr. Blair: Neither are we.

The Prime Minister: The right hon. Gentleman says, “Neither are we,” but he is. The right hon. Gentleman did not mention that Labour would undermine the veto by making majority voting the rule. The right hon. Gentleman shakes his head but it is in the European socialist manifesto, co-authored by the right hon. Member for Copeland, who said, subsequently,

“We stand by everything in this document.”

It is no good the right hon. Gentleman shaking his head and looking embarrassed. That is what the right hon. Member for Copeland said. With whom does he agree–his right hon. Friend the Member for Copeland, his right hon. Friend the Member for Kingston upon Hull, East, socialist Members of the European Parliament or the European socialist partners whom he goes to visit and signs things with so often? Whom does he agree with? Does he agree with himself on this issue? Do we know?

If we gave up the veto we could not only be outvoted on own resources, tax harmonisation, foreign policy, immigration policy, protected areas of environmental policy and any policies which, in the words of the treaty, are deemed

“necessary to attain . . . the objectives of the Community”.

[Interruption.] It is a spirited discussion. If it were possible, I would give way to let the right hon. Member for Copeland intervene upon the right hon. Member for Sedgefield, but I am sure that they can discuss it elsewhere.

Dr. John Cunningham: I am grateful to the Prime Minister for giving way. [Hon. Members:– “Resign.”] If anyone should resign around here it is the Prime Minister and his right hon. and hon. Friends.

The Prime Minister should withdraw his allegation that either the European socialist party manifesto or our own manifesto for the European elections last year said that we should abandon Britain’s veto. Neither document did so and to suggest otherwise is to tell an untruth.

The Prime Minister: The right hon. Gentleman said that the Labour party would make majority voting the rule. If it is the rule, what else could it be other than the abolition of the veto? He can wriggle and wriggle and wriggle, but he is on the hook and he knows it. Without that veto how would the Labour party protect our interests? The right hon. Member for Sedgefield had some other memorable omissions as well. He did not mention the memorable indication by the shadow Chancellor to have some renegotiation on our rebate. Our rebate was protected at Edinburgh. It saved the country billions, but without the veto it might not be possible to save it.

Neither did the right hon. Gentleman mention those Labour Members of the European Parliament who voted to double the European budget and dramatically increase Britain’s net contribution. I do not know whether that is Labour party policy or whether they were simply being infantile again. He did not mention that Labour wants

“to avoid a tax-cutting competition between member states”. What does that mean? At the moment British taxes are lower than those of our European partners. Does he want to raise British taxes to higher European levels or does he believe he can negotiate with the Europeans to bring their taxes down to our level when they all have fiscal deficits in their countries?

We know that the Labour party would impose the social chapter and drive out investment and competitiveness. We know that the right hon. Gentleman has said that he will

“never allow this country to be isolated . . . in Europe”.

Sir Russell Johnston (Inverness, Nairn and Lochaber): Will the Prime Minister give way?

The Prime Minister: If the hon. Gentleman will forgive me, I will not. I have given way on a number of occasions.

How will the right hon. Member for Sedgefield win battles in Europe that are in our national interest if he is too frightened to be isolated in those battles? Does it mean that he would never be prepared to stand alone, never be prepared to defend any position, any principle, any vital interest, if it would mean offending his socialist colleagues across Europe?

What happens if Europe wants to do something that is genuinely against our national interest? How would the right hon. Gentleman prevent it? He does not want to disagree. He does not want to use the veto. The fact is that the Labour party’s policy is one of weasel words and soundbites. It is not a policy for Britain. It is an abject surrender by the right hon. Gentleman.

We have fought for the changes that we want–the single market, enlargement to the east, a new accent on competitiveness and free trade, less new European legislation with national action as the norm and development of the Union through intergovernmental consent. None of that suggests that the Government would be dragged along by others in a direction in which we do not want to go. That may be the stuff of tabloid tales, but it does not stand up to detailed examination of our record.

We are prepared to be isolated and fight our corner, and the House does have to choose–between our hard-headed, commonsense, pragmatic approach to Europe or the politically correct federalist posturings of the Opposition. It should not be a difficult choice and I invite the House and all my hon. Friends to make that choice tonight.

March 1, 1995
PMQT – 7 February 1995

Below is the text of Prime Minister’s Question Time from 7th February 1995.

PRIME MINISTER:

Engagements

Q1. Mrs. Ewing: To ask the Prime Minister if he will list his official engagements for Tuesday 7 February.

The Prime Minister (Mr. John Major): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mrs. Ewing: Since the Government’s policy has virtually destroyed the manufacturing base of the north of Scotland–including industries such as our pulp mills, oil fabrication yards and a smelter–and, more recently, led to the mothballing of three distilleries, is the Prime Minister prepared to allow the Cabinet to sit back and watch the destruction of our tourist industry as a result of the axing of rail services, both sleeper accommodation and Motorail facilities, to the north of Scotland ? Will he, as a courteous man, now instruct the Secretaries of State for Transport and for Scotland to afford the representatives from the north of Scotland a meeting–a request for which was submitted some six weeks ago–tomorrow to discuss those vital issues?

The Prime Minister: Of course I shall look carefully at what the hon. Lady has to say. We are keen to see a successful tourist industry in the north-east of Scotland and elsewhere in the United Kingdom. If the hon. Lady looks right across Scotland as well as the rest of the United Kingdom, she will see that manufacturing industry is expanding, doing extremely well, making many things that just a few years ago were simply not made in Britain, and exporting at record levels around the world. In the past year there have been eight successive new monthly records in exports alone.

Mr. William Powell: Will my right hon. Friend reaffirm the Government’s support for British agriculture in order to assert that farmers are as entitled as any other of Her Majesty’s subjects to earn their living under the law, and that includes selling their young veal calves at a proper market price if they so choose? Will he confirm that causing mayhem at British ports and airports is no way to stop practices in other countries that we have banned here, and that those who do so should take their cause to other countries in the Community and to the European Parliament, not pursue it here?

The Prime Minister: My hon. Friend is right to stress the importance of the farming industry and entirely right to stress the fact that farmers have a right to carry on their trade within the law, as does everyone else. I think that my hon. Friend and the House know our opposition to veal crates and of the measures taken by my right hon. Friend the Minister of Agriculture, Fisheries and Food to try to ensure that they are taken out of commission not just in the United Kingdom but right across Europe.

Mr. Blair: Will the Prime Minister state clearly whether he agrees with the Chief Secretary to the Treasury, who has said that he would wait an eternity before joining a single currency?

The Prime Minister: I set out in detail the conditions for a single currency, originally as long ago as 1990. I reaffirmed them in some detail last Friday. I made it clear last Friday that not only must the specific Maastricht criteria be met, but that in addition we would require other criteria to be met before we thought it appropriate to consider a single currency. Some years in advance of those being met, it is unwise to say either, “Yes we will proceed,” or, “No, we will never proceed.”

Mr. Blair: On Friday, of course, the Prime Minister was generally facing both ways. Indeed, Conservative central office was briefing one message on Friday and Downing Street another yesterday. If he will not slap down his Chief Secretary, will he say whether he agrees with the Chancellor of the Exchequer, who is a supporter of monetary union, and who can foresee circumstances in which Britain would join and wants to do so by the end of the century?

The Prime Minister: I have just set out in great detail precisely the circumstances in which we would find it appropriate to consider whether we should proceed to a single currency. The right hon. Gentleman has not yet indicated that for his own party at all. As to unity, we know that 50 of his Members of Parliament defied the Whip on Maastricht, 40 of his Members of Parliament defied the Whip on the European Communities (Finance) Act 1995 and the Labour party has had seven twists and turns over recent years as to whether or not it is in favour of the European Union. I repeat to the right hon. Gentleman that, as far as a single currency later this year is concerned, we would first require all the specific Maastricht criteria to be met. In addition, we would require other criteria to be met- -for example, relative flexibility of employment markets. My right hon. and learned Friend the Chancellor will set those out later this week. When those other matters are set out, we shall then consider whether it would be appropriate economically or constitutionally to proceed. I hope now that the right hon. Gentleman the Leader of the Opposition, having learnt what the right answer is to that question, will fashion his own policy.

Mr. Blair: Let me put it specifically, then. If those circumstances are met, will the Prime Minister join?

The Prime Minister: I have just told the right hon. Gentleman. When and if those circumstances are met, we shall look to see whether it is appropriate and in the British interests to join. Will the right hon. Gentleman tell us now whether he would join, yes or no? Does he know whether it would be in the British interest? No, he does not. All that he is concerned to do is to trail along the path behind the Euro-federalists, where he feels most happy.

Mr. Blair rose —

Madam Speaker: Order. The right hon. Gentleman has had three questions. I really cannot call him again. I am sorry.

Mr. Blair rose —

Madam Speaker: Order. I believe that the hon. Gentleman has had his third question. If he wants to reply– [Interruption.] The Prime Minister has asked him to reply. In that case, I call the Leader of the Opposition.

Mr. Blair: I think– [Interruption.]

Madam Speaker: Order. It is most unusual for Prime Ministers to ask the Opposition questions at Question Time.

Mr. Blair: I think that it is excellent that the Prime Minister is getting into the habit of asking us questions rather than answering them himself. Can I tell him this, though? Until he decides where he stands on that issue as the Prime Minister of the day, his leadership will remain weak, his Cabinet divided and Britain effectively disabled in Europe.

The Prime Minister: It is interesting to ask the right hon. Gentleman questions. It would be more interesting if he ever provided any answers.

I have set out for the right hon. Gentleman the conditions in which it would be right for us to consider the interests of the United Kingdom. I will not make a judgment that is crucial to the constitutional and economic future of this country until I see the economic circumstances of the day– and, frankly, only a dimwit would ask me to. [Interruption.]

Madam Speaker: Order. This is very time-consuming.

Mr. Streeter: Does my right hon. Friend accept that his concept of a European Union of nation states co-operating and working together for their common interests is in touch with the majority view in the country? Does it not contrast starkly with the policies of the Opposition parties, which can be described as a total sell-out to Brussels?

The Prime Minister: I think that this country has a very deep attachment to the nation state. The European Union that it seeks is a European Union based on nation states–a wider European Union, a free market European Union, a decentralised European Union, and not the federal European Union that the Opposition wish for and their Members of the European Parliament clamour for.

Mr. Ashdown: Is the Prime Minister asking us to believe that it is none of his business, and not his Government’s responsibility, that school governors across the land are being forced to cut school budgets and sack teachers? Or is he saying that that is a price that our children should be prepared to pay so that he will have room for tax cuts at the next election?

The Prime Minister: As ever, the right hon. Gentleman has his facts wrong. If he looks, he will see the increased spending on teachers, support staff, books and equipment. He will also see that the Audit Commission regularly identifies significant scope for savings by local authorities–not least Liberal Democrat-run local authorities–and their freedom to transfer more resources to education. The right hon. Gentleman may also learn that authorities are maintaining some 1 million surplus school places. Perhaps next time he asks a question, he will have ascertained some of those facts before doing so.

Mr. Waller: Does my right hon. Friend agree that the publication of new guidance relating to appointments to quangos is an extremely positive and welcome advance? Is not the constant criticism directed at members of such bodies bound in time to become a disincentive, and to prevent public-spirited persons from putting their names forward for membership?

The Prime Minister: Yes, I think that the review will prove extremely useful. It also emphasises that both the number and the real cost of non-departmental bodies have fallen significantly since 1979. As everyone who has examined the matter knows, the Opposition’s criticism of such bodies is really based on their dislike of parent choice in schools, their dislike of patient choice for fundholding general practitioners and their dislike of patient choice in hospitals. That is local choice, but they call it quangos. They wish to retain choice centrally now, as they always have.

Q2. Mr. Gordon Prentice: To ask the Prime Minister if he will list his official engagements for Tuesday 7 February.

The Prime Minister: I refer the hon. Member to the answer I gave some moments ago.

Mr. Prentice: Does the Prime Minister agree with the Secretary of State for Education, who believes that a teachers’ pay increase could be funded only at the expense of between 7,000 and 10,000 teaching jobs and a spiralling increase in class sizes? How does that square with what the Chancellor of the Exchequer said at lunchtime today–that extra cash is not available and is not needed? Who speaks for the Government on this matter? More important, who speaks for the children in our schools?

The Prime Minister: We speak for the children in the schools. That is why we have given their parents choice, why we have given greater choice in schools, why we have produced performance tables, and why we have produced testing. That is why our crusade is for choice not to close city technology colleges, not to close grant-maintained schools, and not to close every element of choice that parents want and children need.

Mr. Bill Walker: Has my right hon. Friend noticed that the Scots favour the Union between Scotland and England and the rest of the United Kingdom because the Scots, with less than 9 per cent. of the UK’s population, enjoy far more positions of importance–for instance, in the Cabinet, the proportion is in excess of 20 per cent., whatever the Government–in the military, in trade unions and in industry? That is what the Scots will not give up.

The Prime Minister: My hon. Friend speaks in a tone that many people will recognise. There is no doubt about the advantages, both to the UK and to Scotland, of Scotland being a full part of the UK. I do not believe that anyone who has studied the problem doubts that for a single second. The talents– [Interruption.] The hon. Member for Banff and Buchan (Mr. Salmond) clearly has not studied it because he does doubt that. That is because he wants an independent Scotland disunited from the UK, in the middle of a European Union where it would have little or no influence, and that would damage the interests of Scots, the interests of Scotland and the wider interests of the UK. That is why his party must never be put in power in any way in Scotland or elsewhere.

February 7, 1995