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Single European Currency

Volume 596: debated on Wednesday 3 February 1999

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Whether they will issue a White Paper on the advantages and disadvantages of the United Kingdom joining the Single European Currency.

My Lords, the Government have set out clearly their position on membership of the single currency. There is no constitutional bar to UK membership of the single currency. If the single currency is successful, and if the economic case for joining is clear and unambiguous, we believe that the UK should be part of it. We have set out five economic tests to help us make that decision.

My Lords, I thank the Minister for that Answer, which I have to say I find depressingly unilluminating. Is it true that a national changeover plan is to be published in February detailing the 40-month period—the timetable—between calling a referendum and the final transition to the euro as the single legal currency in the UK? Further, can the Minister tell us how you can have a changeover plan when the Government do not say clearly what is their final objective? Surely it is time for the Government to stop equivocating and tell us.

My Lords, I am sorry that the noble Lord finds my Answer unilluminating. It has been the same answer for nearly 18 months now, so he has been in the dark for a very long time. That cannot be my fault. The changeover plan which will be published soon—and I do not say in February—will not deal with organisational issues concerned with the referendum.

My Lords, I believe it really is the turn of the noble Lord, Lord Marsh.

My Lords, a very fair point was made that the arguments should be displayed more actively to the public in general. Given the fact that the Government have already, on their own admission, spent £7.4 million extolling the virtues and advantages of entry, would it not be fairer—it would certainly be cheaper—if the Government were to subcontract the disadvantages to an outside and more objective body? I am authorised to say that Business for Sterling would do it as a public duty.

My Lords, the noble Lord is quite wrong. No money has been spent on extolling the virtues, but money has quite properly been spent to ensure that British business is prepared for the existence of the euro, whether or not we are members of the single currency. That is a public duty.

My Lords, does my noble friend the Minister agree that, great though the abilities and capabilities of the present Government may be, to produce on this subject a White Paper that states fairly and objectively both the case for and the case against—that is to say, the advantages and disadvantages—is something which is quite beyond their ability to accomplish?

No, my Lords; I do not accept that. It is not beyond the ability of the Government to accomplish it. However, to publish such a White Paper now would be premature as so many of the factors to be taken into consideration when we do make the final decision and when we do make a recommendation to Parliament and to the people are not known.

My Lords, will the Government stop suggesting that the only question is whether the economic case for joining has been made out? Whatever this Government do, say or think, is it not the case that virtually every other member government of the European Union accepts that the euro is a step towards political union? Therefore, should not the British people be told that?

My Lords, the Government have never said that the economic case is the only case. We have acknowledged that there are constitutional issues involved, but we have said that there are no overriding objections on constitutional grounds. However, having said that, clearly the economic case is of very great importance.

My Lords, did my noble friend use the expression, "We shall join if the case is clear and unequivocal"? As regards those of us who believe that the case is clear, unequivocal and overwhelming, is it the Government's view that we simply do not understand these economic and financial matters?

My Lords, I respect my noble friend's view and I have always respected it. That respect is not posited on a claim that he misunderstands the issues. He takes the view that it is a question of "when". We take the view that it is a question of "if'.

My Lords, does the Minister accept that opinion in the City is increasingly concerned that if we do not join soon, the City may lose out, as the Lord Mayor of London said the other day? What is the Minister's response to that?

My Lords, I read what the noble Lord, Lord Levene, said and I respect his views. I accept that he expresses a commonly held view in the City. We shall take his views seriously.

My Lords, does my noble friend the Minister welcome the news that in January the euro accounted for half of all funds raised by borrowers in the international capital markets compared with 40 per cent. who borrowed dollars? Does not this promising start to the euro suggest that Her Majesty's Government should declare their intention sooner rather than later?

My Lords, I reported the facts which my noble friend has repeated in my wind-up speech in the debate on the subject last month. Of course it is an important factor in the consideration which the Government are giving to this issue.

My Lords, does the Minister agree that the European single currency will have not only short-term effects on our economy but also long-term effects? In view of the fact that there is to be a referendum financed by taxpayers' money, will the Minister give a categoric assurance that the advantages of a single currency will be set out as well as the disadvantages so as not to create any bias on one side or the other?

My Lords, the noble Lord is right that British membership of the single currency has long-term effects as well as short-term effects. As regards expenditure on a referendum, clearly the Government have a duty to put their view to the electorate but the noble Lord will have seen the recommendations of the committee of the noble Lord, Lord Neill, which we are considering.

My Lords, the Government have laid down five economic criteria for the UK joining a single currency and have also stated that they see no overriding constitutional objection to that. Will they now lay down the political and constitutional criteria they consider necessary for the UK to join, given the fact that—as my noble friend said—most member governments see the single currency as leading to the political unification of Europe? Perhaps the Minister will give us his views on the political advantages and disadvantages of that outcome.

My Lords, the noble Lord rightly sets out the first part of the Government's policies on the single currency. He then invites us to comment on the views of other governments on the long-term future of Europe. That is a matter for other governments and not for this Government. I have no intention on behalf of this Government of second guessing other governments in Europe.