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Lord Jenkins of Hillhead: My Lords, I, too, thank the Lord Privy Seal for having repeated the Statement. I believe that a fair summary of the Prime Minister's report on Amsterdam would be that it shows he has already vastly improved Britain's working relationship with our European partners but has not yet, hardly surprisingly, solved all the difficulties of Europe. But it is something that Britain has moved from being the problem of Europe to perhaps offering at least a part of the solution, at the same time showing how relatively easy it is with a little good will to achieve quite a lot of what are thought to be Britain's special interests, some of which I am more enthusiastic about than others.

The contrast with the previous Government's ineffective mixture of braggadocio, humiliating retreat and maximum ill will could hardly be greater. In the circumstances the noble Viscount, Lord Cranborne, although opening in a more muted way than he has sometimes done recently, was perhaps a little ungracious. I particularly treasure his statement that there is deep suspicion throughout the country of the Government's attitude to the social chapter. I am reminded of "My Fair Lady" and references to parts of Hertford, Hereford--rather doubtful--and Hampshire. It could just possibly be true of those three counties. Broadly, throughout most of the country, I believe that the Government are enjoying an almost over-heady honeymoon. I do not find much touch with reality in what the noble Viscount said. Representing a party which handled the European issue in such a way as to wreck Britain's influence in Europe and at the same time nearly destroy itself was a remarkable feat which might have been expected to produce a little humility.

However, there was one service which the previous Government rendered to Europe. By uniting everyone else against ourselves, it made them somewhat artificially patch over their own differences. This time, the uniting bogey man having been removed, or at least some of his features having been modified, the more cross currents begin to emerge. That is not in itself unhealthy and gives us a position of greater influence. However, I think that it should be subject to two important provisos. First, to attempt to sunder in recrimination the Franco-German partnership would be an act of gross irresponsibility which could have grave consequences not only for Europe and ourselves but also for the world. Secondly, whether we are in or out, for the single currency to fail at this stage would be like the juddering halt of a vast airliner whose engines had been reversed at the very last moment. The mood would be sullen throughout Europe. I do not think that the next great challenge and important British interest--that of the enlargement to the east--could then be faced and overcome.

It was in regard to preparation for enlargement that Amsterdam accomplished least. If the Community is to be enlarged to 20-plus, it is essential that the number of commissioners be reduced from the present basis. Already in my day, with a Community of nine, there

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were one or two too many commissioners. It is essential, too, that the decision-making process in the Council of Ministers is strengthened. These were the unsolved issues of Amsterdam.

Amsterdam as a whole, however, I count as a good beginning for the Prime Minister; although it leaves him with many tests to face in the future. It was neither a disaster nor a triumph for the European Union--although such modified success and partial disappointments should be seen in perspective as having always been part of the rhythm of Europe.

Lord Richard: My Lords, I am grateful for the remarks of the Lord Privy Seal, at least for the beginning of his remarks--

Noble Lords: You are the Lord Privy Seal!

Lord Richard: My Lords, there it is. One is concentrating so much on other matters. I shall try again, and I shall not make that mistake again. I am grateful for the remarks of the noble Viscount the Leader of the Opposition--at least for the beginning of his remarks. I am also grateful for the comments of the noble Lord, Lord Jenkins of Hillhead.

The noble Viscount gave us a short lecture. In his kind, avuncular way he said that perhaps we were innocents in shark-invested waters. Speaking as one of the former sharks, I do not think the Government are innocent. In any case, for the Leader in this House of the party opposite to attempt to give anybody lectures on how to handle Europe and European policy is a little rich. Given that his party reduced British influence in Community institutions to the depths in which it was found by us on 1st May, I really should have thought that a decent period of silence on the part of Members opposite would be more appropriate.

The noble Viscount asked me a number of detailed questions. Some I can answer and some I cannot. I will write to him about those that I am unable to answer now. He said that the summit was a little weak on enlargement. The position on enlargement is this. The Commission will present its papers next month covering not only enlargement but also the related issues of the common agricultural policy, structural fund reform and the future financing of the European Union. It looks as though negotiations will start relatively soon thereafter. Frankly, that is not being slow on enlargement. In addition, the principle that was agreed is that there should be a reduction in the number of commissioners on the one hand but that there should be a re-weighting of the votes in the Council of Ministers on the other. That principle was agreed. To return from an international summit with those measures on enlargement in one's pocket was a distinct success and did not deserve the muted words of the noble Viscount opposite.

The noble Viscount asked me about the social chapter. He and I, and the party opposite, examined the social chapter on many occasions. My views on it are pretty well known. We have not agreed to any extension of qualified majority voting in the social field.

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Unanimity still applies in areas vital to competitiveness, in particular social security, co-determination in the boardroom and dismissal rights.

Qualified majority voting does apply in some other areas under the social chapter. However, it does not mean that we shall not be able to influence legislation. Of course we shall; we shall be there in order to influence it. A constructive approach overall means that one's partners are rather more likely and willing to listen to one's specific concerns.

Let us be clear. There is no half-way house between opting in and staying out. If we want to be able to influence the social and employment agenda and promote competitiveness across the European Union, we must be there at the table arguing our case. For example, if the working time directive demonstrates anything, it demonstrates that the previous Government's opt-out in no way protected them from being out-voted on measures with which they disagreed.

United Kingdom prosperity as a whole depends on the competitiveness of the European Union as a whole. Staying on the sidelines is no answer. The only way to ensure that Europe develops in the way in which we want it to develop is to persuade others of our case. The recognition by the Amsterdam Council of the importance of flexible labour markets and employability demonstrates that that is possible.

The noble Viscount asked me about the wording in the conclusions on jobs, which he found a little "padded". I do not think that he could have read the annexes to the presidency conclusions. One of them, the resolution of the European council on growth and employment, states:

    "In addition, we will need to strengthen the links between a successful and sustainable Economic Monetary Union, a well-functioning Internal Market and employment. To that end, it should be a priority aim to develop a skilled, trained and adaptable workforce and to make labour markets responsive to economic change. Structural reforms need to be comprehensive in scope, as opposed to limited or occasional measures, so as to address in a coherent manner the complex issue of incentives in creating and taking up a job".
That does not seem to me to smack very much of corporatism. On the contrary, it seems to illustrate quite clearly what we were aiming for and succeeded in achieving.

The noble Viscount asked about defence, and about remarks made by a Dutch presidential spokesman. I should not dream of commenting on a report in a British newspaper. I am certainly not prepared to comment on a report of what might eventually appear in a Dutch newspaper. I have not seen what the Dutch spokesman is supposed to have said. I shall make a point of looking at it.

To turn to common defence and foreign policy, the noble Viscount asked whether we have preserved the veto. Yes, we have preserved the veto. We are in favour of closer co-ordination and co-operation in these areas, but we are not in favour of giving up the British veto on action in these two areas. That we have preserved.

I hope that the House will have an opportunity at some stage to examine this matter in greater detail. I cannot this afternoon give any commitment at all as

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to whether, or when, a debate will take place. I can only give the same reply as the noble Viscount used to give to me. It is a matter for the usual channels, and I will consult with them.

4.18 p.m.

Lord Boyd-Carpenter: My Lords, before the noble Lord sits down, will he give an undertaking that the House will have an opportunity to debate in full this enormously important Statement, and that the debate will be given a full day without diminution in view of the general interest and importance of the matter?

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