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1996 - Malcolm Rifkind’s Pre-Dublin European Council Statement

Below is the text of the Foreign Secretary’s [Malcolm Rifkind] statement to the House of Commons on 12th December 1996, out-lining the Government’s policy on the Dublin European Council meeting, to be held the following day.


THE FOREIGN SECRETARY:

The Secretary of State for Foreign and Commonwealth Affairs (Mr. Malcolm Rifkind) On this, the second day of our debate on the European Union, I wish to concentrate my remarks on the intergovernmental conference and the Dublin summit.

First, however, I will respond to certain remarks made by the President of the European Commission, who said the other day that the hour of truth was approaching when the United Kingdom would have to decide whether it believed in Europe as a free trade area or as a political union. Many hon. Members like to present the issue in equally Manichaean terms. It is reminiscent of choices that used to be urged upon British Governments: Commonwealth or Europe? America or Europe? Those have always been false choices because reality lies between such poles.

For Britain, the European Union is, and always was, more than a free trade area. For a start, the single market involves much more than the elimination of tariff barriers. That was the first and easiest step in its creation. It also needs rules to prevent non-tariff obstructions to trade, like the mediaeval rules on what could go into a pint of beer, which excluded British beers from Germany, or the rules on insurance policies, which eliminated competition, whether on price or product innovation, in much of the continental market.

All that involves supranational rules and supranational institutions, whether the Commission or the European Court, to enforce them. British consumers, workers and manufacturers have all benefited from those rules.

It is strongly in the British interest that the EU should have a common external trade policy. There is a persistent continental instinct, particularly in France, to put up trade barriers around a fortress Europe. Yet those instincts were faced down by the Commission, which negotiated a market-opening GATT deal on behalf of us all. That would not have been possible - nor would we have been able to protect British commercial interests as well as we did - without strong European institutions.

If a simple free trade area was such a splendid option, why has the European Free Trade Association collapsed? Why did Sweden, Finland and Austria so quickly abandon the European economic area, which came into force only in 1994, in favour of full membership of the EU? The answer is that, to secure tariff-free access to the European Community, they found themselves having to follow single market rules and regulations, including competition policy, over which they had no control or influence. That may be a sustainable position for Iceland, Norway or Liechtenstein, but I hardly think that it would befit a country of our size and history.

Mr. Alex Salmond (Banff and Buchan) I agree with the Foreign Secretary that the European Union is and should be more than a free trade area, but may I bring him to the specifics of the intergovernmental conference? A few months ago, the Prime Minister told the fishing industry that resolution of the flags of convenience scandal was his first priority at the IGC. A few weeks ago, however, we were told that the 48-hour week had become the major priority. I wish to ask a simple question: if the Prime Minister succeeds in resolving the flags of convenience issue, will he still block agreement until he gets his way on the 48-hour issue?

Mr. Rifkind We have spelt out a number of crucial objectives, of which the issue that interests the hon. Gentleman is one. It is not necessary to add to that now. We have said that those are crucial matters and the conference cannot come to a conclusion unless all members are satisfied with the outcome.

Even in the area of commerce, the EU is much more than a free trade area. But its benefits are also felt in many areas not directly related to the market, such as increasing co-operation in the fight against international crime, higher environmental standards and an increasingly confident European voice on the world stage. The common foreign and security policy does not replace national foreign policy, but complements it. That works to our advantage, as other European countries' views on many issues are very close to ours, and a common European policy where it applies can exert greater influence than the UK could achieve on its own.

Above all, the European Union is the basis on which we can consolidate democracy and prosperity across the whole of Europe, including our central European neighbours.

Opponents of British membership of the EU like to argue that we joined a mere common market that has insidiously developed a political agenda. That is nonsense. The European Union has always had a political as well as an economic purpose. Britain recognised that very clearly when we went in: indeed, it was a central consideration behind our application for membership.

Mr. William Cash (Stafford) Yesterday, my right hon. and learned Friend the Chancellor of the Exchequer said that he had no objection in principle to the idea of a single currency. My right hon. and learned Friend the Foreign Secretary, in reply to me in the European Select Committee in February when I pressed him on economic and monetary union, said that he did not follow my point that it was a question of principle. Does my right hon. and learned Friend not accept that there is a basic and fundamental inconsistency in the views expressed on the question of principle by the Chancellor and by himself? Does he agree that that is causing a great deal of uncertainty and confusion, that the matter should be resolved, and that it should not be construed as dissembling?

Mr. Rifkind I have no doubt whatever that the question of a single currency and the possible abolition of our national currency would be a great historic decision. It would probably be irreversible, so it is right that it should be addressed as one of the most important matters to be considered by a British Government for many years. I believe that every member of the Government believes that it is of crucial significance. It is therefore right to ensure that the issue is addressed with regard both to its economic implications and its wider consequences - the national decision making that we currently enjoy and the extent to which that might be diminished in the event of a single currency.

Mr. Norman Lamont (Kingston upon Thames) I should like to return to what my right hon. and learned Friend was saying about the European Union's functions and ask him a question that an ambassador of this country asked me. He asked me to explain to him why it was necessary for the European Union to have more than 120 embassies - or "delegations" as they are called - around the world at a cost of £150 million per year. Is it really necessary, given the European Union's functions, to have that degree of representation?

Mr. Rifkind I would not necessarily wish to defend the exact number as it currently applies, but the European Union has overseas aid programmes in many countries and needs to implement those programmes through local offices. It is also responsible for handling the external trade policies of all its member states. Those external trade negotiations cannot be conducted without a physical presence in countries such as Japan or many other countries with a crucial involvement in trade matters. So while I am not inclined to justify every area of expenditure or every office, I acknowledge that the European Union needs a significant number of overseas premises to conduct its proper business.

Several hon. Members rose -

Mr. Rifkind I realise that an awful lot of hon. Members wish to speak in this debate. Although I do not intend to give way to everyone who wishes to intervene, I shall try to be fair.

Mr. Christopher Gill (Ludlow) Will my right hon. and learned Friend give way?

Mr. Rifkind Not at this moment, but perhaps later.

If Europe is more than a free trade area, it is less than a federal state and must remain so. The bedrock of the European Union is the independent democratic nation state. The European Union derives its legitimacy and functions from the powers freely given to it by its members. It can flourish only as a partnership of nations.

The Government have a clear view of what the European Union is, and how it should develop. It is a partnership of nations reconciled after centuries of rivalry and conflict. Those nations have a strong sense of shared purpose and shared values; they have created a single market open internally, and open to the rest of the world; they are committed to maximum co-operation in foreign and security policy and in such issues as the fight against international crime; and they have joined forces in the common enterprise of the European Union while retaining the separate identities that give Europe its richness and character.

Overall, and in its historical context, the degree of co-operation in Europe today is extraordinary and unprecedented. The European Union has been the focus of that achievement, but the quest for ever more institutional integration puts all that at risk.

If an hour of truth is approaching, it is perhaps for the integrationists in Europe, who need to define the limits of their ambition. Where do they see the process that they promote finding its natural conclusion? At what point will dynamism in the EU be measured in the use that we make of the institutions that we have created, rather than in their endless modification? At what point will integrationists accept that deeper is not always and necessarily better?

All sides decry the term "super-state". Chancellor Kohl agrees that independent democratic states are at the heart of the European project. Amen to that; yet if the EU is to be the basis of lasting peace and prosperity in Europe, and if people - not just in the UK - are to be reassured that they are not in the belly of some infernal machine that is running out of control, they need to feel that there is some logical conclusion to the process of European integration, short of a super-state.

That is why all the member states need to think hard about the purposes and limits of integration.

Mr. Hugh Dykes (Harrow, East) I am grateful to my right hon. and learned Friend for giving way at this stage, as he is giving a fair and objective description of what the European Union should mean in the future. Would it not be better for the British Government to avoid the use of the word "federal", as it is so misleading? Too many people fear that it means centralisation, whereas it has many different meanings in different countries. NATO was a federal treaty in every respect and all the way through its clauses. It would be much better to refer to the use of majority voting and greater integration to enable enlargement to take place. That is the aim of the process.

Mr. Rifkind I strongly disagree with my hon. Friend. I do not believe that the term "federal" is inappropriate. Of course, if one starts with a single central state and then federalises, one is decentralising. However, that is not the starting point in Europe. The starting point is 15 independent nation states. If the attempt is to create a supranational institution with supranational authority at the expense of national Parliaments and national Governments, one is undoubtedly moving in a federal direction and, depending on the degree of integration that is conceded, one can end up with a federal state. Those who want that objective should not be so shy about using the term that properly describes their ambitions.

Mr. Nigel Spearing (Newham, South) The right hon. and learned Gentleman said a few moments ago that the European Union was something less than a federal state, or words to that effect. Surely it is already something more. A federal state has a separation of powers, whereas we already have a single court, a single Council, a single Commission, a single Parliament, possibly a single currency and a single central bank, and perhaps a single representation abroad on a single commercial policy. Does that not mean that, far from being federal, the EU is already centralised?

The Chancellor of the Exchequer said yesterday that he wanted to know what his colleagues abroad thought. In effect, they are asking for a single institutional state that would leave no real power for a national Parliament such as ours.

Mr. Rifkind The hon. Gentleman is correct to say that there are supranational institutions, as he described. The crucial factor in determining whether we have yet achieved a federal system is the amount of overall power that the supranational institutions have. If one considers the totality of decisions on the use of resources, for example, or on legislation, or on matters affecting the life of individual citizens, one finds that the use of only a small fraction of the resources raised in this country is at present determined by supranational institutions. One is entitled to make that point.

Mr. Bernard Jenkin (Colchester, North) rose -

Mr. Rifkind I will give way in a few moments, but I must make progress.

I now want to focus on the issues before Heads of Government at the Dublin European Council tomorrow and on Saturday. Aside from economic and monetary union, the IGC discussion at Dublin is likely to be the most substantive. Heads of Government confirmed at their meeting in October that the IGC should end at the Amsterdam European Council next June. We strongly support that goal. The IGC must swiftly complete its work so that Europe can concentrate on the real-world challenges of the coming years, and in particular on enlargement.

The Irish presidency's report on the state of the IGC negotiation is a sensible contribution to completing the process on time. It draws together into one document options that are on the table, including all the UK options. I emphasise that the presidency report is just that: a report. It is not a draft proposal for decision. Decisions are still six months away. Nothing can be agreed until everything is agreed, and that will be by unanimity. However, the report gives a snapshot of the scope of the conference, areas of emerging consensus, and areas in which either the work is not yet much advanced or it is already clear that there are major differences of approach.

Let me start with the positive side. The paper demonstrates that the UK's ideas are gaining ground in a number of areas, including subsidiarity, the role of national Parliaments, and practical improvements to the operation of the common foreign and security policy. The report also demonstrates that in many areas of institutional change in the European Community, the rhetoric employed by some of our partners has perhaps run ahead of the reality.

On the extension of qualified majority voting, for example, the presidency report is almost silent. It says somewhat disarmingly: Many Member States are at this stage reticent about showing their hands". In these areas - and many others - good progress is being made, but the presidency report also reveals a number of areas where member states' positions remain far apart. I want to focus the rest of my remarks on some of the most important of these.

I begin with immigration, asylum and issues of free movement and frontiers. The presidency report brings into focus ambitions in some member states of which this House has been aware for many weeks and months from the IGC documents that we have regularly deposited as the negotiation has proceeded. Some partners would like to develop those issues as competences of the European Community, removing them from the scope of intergovernmental co-operation in the third pillar.

That, of course, is out of the question, and not just for the UK. The presidency report notes: A number of Member States have indicated that they do not accept the transfer of any matter at present dealt with in the intergovernmental pillar.

The third pillar, which also includes the fight against international crime and drug trafficking, covers areas of national competence. That is why it was decided at Maastricht to develop those issues within a separate pillar of the treaty.

Sir Teddy Taylor (Southend, East) As the European Parliament has said clearly and specifically that it will take Britain to court over the issue of border controls in the event of our using the veto at Amsterdam, and since many of us have believed for years that the declaration of the Single European Act has no real validity in European law, what on earth would any British Government do if the European Court determined that our border controls had no legal basis?

Mr. Rifkind The Government attach the same importance as my hon. Friend does to the absolute observance of the assurances that have been given with regard to frontiers. We believe that those assurances can be depended upon. We have not the slightest intention of conceding one inch with regard to the right of this Government and this Parliament to control frontiers. That is crucial to the United Kingdom's position.

We are keen to develop co-operation with our partners in these areas. We have put forward proposals in the IGC to improve the operation of the third pillar.

For issues as sensitive as these, however, it is a myth to suggest that Community decision-making could be effective. It would complicate and delay practical progress. The priority is to act. The decisions that I hope we can reach at Dublin on drugs and international crime are good examples of the action that we should be taking. We want Dublin to exercise real impact in these areas.

On frontiers, as I have stressed, our position could not be clearer: the United Kingdom will maintain its right to impose necessary controls. For an island - for these purposes the UK and Ireland operate as a single island within a common travel area - frontier controls are the best and least intrusive way to prevent illegal immigration. For partners with extensive and permeable land borders things might look different. They rely on identity cards, residence permits, registration with the police, and so on to maintain internal security. That is a sensible approach for them, but it is not an approach that would suit our geography or our traditions.

Our partners know that our position on this issue is unshakeable. There is an interesting acknowledgment of that on page 36 of the presidency report, where it is observed that, if the Schengen agreement was ever incorporated into the European Union, there would have to be "provision for opt-outs".

That leads naturally to the question of flexibility, which is perhaps the most far-reaching issue under discussion in the intergovernmental conference. The idea that it is perfectly healthy for some member states to integrate more closely or more quickly in certain areas, provided that all agree, was first developed by my right hon. Friend the Prime Minister. As the European Union enlarges, it must find better ways to accommodate the diversity of its membership. Not only is Britain a firm advocate of flexibility, but flexibility already exists in the treaty - for example, in the EMU arrangements, including Britain's EMU option, and in our social chapter opt-out.

Therefore, the discussion in the intergovernmental conference is not about whether to have flexible arrangements, but how flexibility should operate: whether it should continue to be negotiated case by case or whether there could be value in creating general mechanisms for flexibility within the treaty. There are dangers as well as potential benefits in that approach. We must avoid creating a process whereby vanguard groups establish joint practices and policies that all are expected to follow over time. We must ensure that flexibility cannot be used by others to escape the obligations of an open single market, a strong competition policy and a common commercial policy. Above all, we must ensure that, if groups in the Union want to make use of our common institutions for their own purposes, they have the agreement of all those with a stake in those institutions. If we do agree to new treaty language, the conditions must be tightly defined.

We have always believed that a common European foreign policy should respect the national interests of individual member states. A majority European foreign policy would in any case be weaker than a common policy to which all EU partners are fully committed. On the whole, the debate on the CFSP issue at the intergovernmental conference seems to be going in a welcome direction. The approach which the presidency has put forward as a basis for discussion in its draft paper retains unanimity for the adoption of joint actions and for all decisions with a security-defence dimension. It recognises that, even for other, less significant decisions, individual member states should retain a veto for stated reasons of national policy.

In their recent joint letter, Chancellor Kohl and President Chirac also argued for the retention of unanimity for European Council decisions, for Council policy decisions and for all decisions on security and defence in general. They suggest majority voting only for implementation decisions, while recognising the difficulties of definition. We have said that we are prepared to look at ideas for differentiating between policy decisions and decisions on the modalities of their implementation - although we are not at all sure That it will be possible in practice to define such a distinction.

Obviously we shall have to discuss the issue further, but the fundamental point - that member states have national interests which cannot simply be overridden by majority voting in the European Union's foreign policy - is not now in dispute.

Mr. Robert Key (Salisbury) Can my right hon. and learned Friend say a little more about the statement in "The British Approach to the IGC": In particular, we are ready to look at the idea of appointing a single figure to represent the foreign policy of the Union to the outside world for the CFSP"? I find that hard to understand. That is all very well if it is for the Governor of Hong Kong, but it would be more difficult for someone else in rotation.

Mr. Rifkind There is a fundamental difference: the Governor of Hong Kong has executive responsibilities, and the person we are considering is a spokesperson who does not make policy. We already have a common foreign policy in a number of areas - for instance, our attitude towards the middle east, Russia and many other parts of the world where the interests of the United Kingdom, France, Germany and other western European countries are broadly the same. Therefore, co-ordination between the various member states is often required in order to present that policy properly on a day-to-day basis.

We are open to the suggestion that an official - I stress that it would be an official and not someone with a political background - should be given the responsibility of acting as spokesperson for the European Union in areas where the national Governments have determined a common foreign policy. I believe that that is a sensible and practical improvement that is fully consistent with retaining the clear obligation on national Governments to determine policy.

In the area of defence and security, the Government are strongly committed to effective European cooperation. Our objective is to enable Europeans to shoulder their responsibilities in a way that reinforces, rather than weakens, NATO and the transatlantic link. The United Kingdom is determined that the intergovernmental conference should not put that prospect at risk. That is why we continue to argue that a Western European Union that is subordinated to the European Union, or which discriminates against non-EU allies, could not deliver the real defence options that Europe needs.

The presidency report to Dublin admits that there are divisions on the issue and proposes what it calls a "middle way" to resolve them. It says that the European Union should avail itself of the Western European Union, but in commentary it freely confesses that that covers two alternative approaches. We have made it clear that it would not be acceptable for the WEU to be subordinated to the European Union. It is a separate organisation, with its own treaty base and a different membership. Those facts must be respected, and it is not an area in which we should tolerate ambiguity.

Mr. Terry Davis (Birmingham, Hodge Hill) Before he leaves that point, will the Foreign Secretary address the question of accountability and control over the decisions taken by Ministers of the Council on defence matters? Do the British Government believe that control will still be exercised by national Parliaments, not only in those Parliaments but through delegations to the Western European Union Assembly? Therefore, the arrangement whereby the delegations are in turn responsible to their parties in Parliament would continue.

Mr. Rifkind I believe that defence cannot be separated from the sovereignty of an independent country. Since we joined NATO, we have been willing to have common policies regarding collective security in Europe - and both the WEU and NATO are expressions of that willingness - but we have always emphasised the ultimate sovereignty of the Crown and Parliament regarding defence matters. Therefore, I do not envisage any significant changes in the areas to which the hon. Gentleman refers.

Mr. Dykes My right hon. and learned Friend referred to the European co-ordination of foreign policy in the middle east. He has just returned from a successful visit to Israel and other countries. Will he confirm that the European Community and Union will take a much more profound interest in middle eastern matters in order to assist the peace process, notwithstanding the recent appointment of Madeleine Albright - which has caused some consternation in certain quarters - and the fact that the Americans do not seem able to do it on their own?

Mr. Rifkind The international community must be very sensitive to the situation before it becomes involved in the complex issues of the middle east. There is a case for the western European countries and the United States working together to assist those who seek a successful outcome in the middle east peace process. However, I would have no time for any attempt by European countries to compete with the Americans in trying to influence the outcome. That would make an already incredibly difficult task even more complicated and, ultimately, would prove very divisive. Yes, the international community can help and I believe that western European countries and the United States can co-operate closely in assisting the process. That is the way in which I would take it forward.

There is a strong temptation, felt by a number of our partners and by the Labour party, to do something at the intergovernmental conference to show that Europe is active on the subject of employment. We all agree that creating jobs is one of the key challenges Europe now faces and that there is a role for Europe in creating the right conditions - for example, by completing the single market and working for further global trade liberalisation.

But what added value would there be in a new treaty chapter on employment, as suggested by several member states and supported by the Opposition? Commitments to high, or even full, employment might help the treaty drafters to feel good and compassionate, but they would raise expectations without delivering a single job. On the contrary, a requirement on member states to coordinate policies would risk the imposition on the United Kingdom of continental employment policies that have been manifestly less successful than our own. The Government are proud of their job creation record, and we will not put it at risk.

Like others, we have made a number of proposals in the IGC to meet particular national concerns. Following the judgment of the European Court of Justice on the working time directive, we will require treaty change to restore the position agreed at Maastricht on social policy. Others may want to concoct job-destroying social policies between themselves, but we shall not accept that they should be imposed on the United Kingdom. We have put forward proposals that would disapply the working time directive from the United Kingdom and would close off the possibility of using Community treaty articles to force social policy on the United Kingdom by the back door.

We have also made proposals to address the problem of quota hopping. The common fisheries policy established a system of national quotas to provide a secure benefit to national fishing communities. Quota hopping undermines that. A satisfactory solution in those two areas will be an indispensable part of any IGC outcome, from the United Kingdom point of view.

Mr. Gill Does my right hon. and learned Friend appreciate that the question of quota hopping will exist only up to 2002? After 2002, when derogations concerning fishing disappear, the policy will be one of equal access to a common resource, and therefore the question of dealing with quota hoppers is purely a short-term palliative.

Mr. Rifkind I appreciate that changes could take place in 2002. It will be for the European Union to negotiate whether alternative arrangements are appropriate, or whether they wish to confirm 2002 for the changes to which my hon. Friend refers.

There is much to be done if the IGC is to conclude by next June, but the work has been well launched, and we will continue to make a constructive contribution based on the approach set out in our IGC White Paper earlier this year: of a Union that develops as a partnership of nations, co-operating together in areas where action at a European level is needed, but proud of our cultural and political diversity and conscious of the limits of integration.

The role of the British Government in any European negotiation is to protect and to advance the British national interest. That is something that Conservatives have consistently done over the past 17 years. That approach has achieved significant benefits for the United Kingdom.

Mr. John Redwood (Wokingham) I welcome my right hon. and learned Friend's support for independent democracies co-operating where we see cause. Does that not mean that we must say no to a European Court which regularly overrides Acts of Parliament, because an Act of Parliament is the ultimate expression of British democracy?

Mr. Rifkind When we joined the European Union, Parliament said that it would accept the jurisdiction of the European Court in so far as the European Court interprets the treaty that provides for our membership. Therefore, the legal position is quite clear. If the European Court of Justice has before it matters of interpreting the treaty of Rome, which we signed and of which Parliament approved, it is able to indicate whether a member state is in breach of the treaty.

There are various ways in which the European Court has performed in recent years of which we strongly disapprove. As my right hon. Friend knows, we made a series of proposals to alter the way in which it functions, and I am pleased to say that the French Government have shown support for some of those proposals. Other Governments have also said that they are positively interested in looking at some of the ideas.

Mr. Alain Juppé, the French Prime Minister, made a powerful speech in Paris, in which he warned that the European Court was developing certain federal tendencies, and said that it was legitimate for that matter to be considered within the IGC. We welcome the fact that the French Prime Minister has acted in that way.

Mr. Bernard Jenkin I am grateful to my right hon. and learned Friend for giving way and for acknowledging the federal character of European Community law. If we allow the European Community to take from us the right to mint our own coinage, so that a single currency becomes irrevocable and is imposed on this country by the decision of one Parliament - a decision that appears to be binding on its successors - have we not then crossed the threshold from being an independent sovereign state to being part of a federal Europe?

Mr. Rifkind The European Union cannot take that right from us. What is possible, of course, is that this Parliament and the people of the United Kingdom, through a referendum, might one day provide the authority for such a change, but it is not something that can be taken from this country unless this country were expressly to give its consent. I think that that point has been fully clarified.

Mr. Charles Kennedy (Ross, Cromarty and Skye) Will the Foreign Secretary clarify further the point raised by the right hon. Member for Wokingham (Mr. Redwood) about the European Court? I am sure that the Foreign Secretary would not want to raise his right hon. Friend's hopes unnecessarily. Given the limited, and rather sensible, reforms that the Government propose to the ECJ, will the Foreign Secretary confirm that there is no question whatever of the British Government failing to send people from this country to the European Court to be active participants in its work and decision making? His right hon. Friend should not be left with the illusion that somehow we are about to disengage.

Mr. Rifkind It is of great importance to have people of the highest legal calibre serving in the European Court of Justice. The present British judge, David Edward, is of a very high calibre indeed and serves this country extremely well. It is worth remembering that we have, as a country, won more cases in the European Court of Justice than we have lost, but that is not to say that we are not entitled to make criticism of the ways in which it sometimes performs. Where it acts in a way that we believe is over-political, or that is contrary to the interests of the United Kingdom, we shall draw attention to that point.

Mr. Cash Will my right hon. and learned Friend give way?

Mr. Toby Jessel (Twickenham) Will my right hon. and learned Friend give way?

Mr. Rifkind I shall give way first to my hon. Friend the Member for Twickenham (Mr. Jessel).

Mr. Jessel My right hon. and learned Friend used the words "over-political". Does that not mean that the European Court is not an ordinary traditional court of justice merely trying to act fairly and justly between litigants within the law as the United Kingdom knows it, but that it has a somewhat different agenda in that its terms of reference require it to advance the cause of European union? It is not, in that sense, a pure court of justice: it makes up the law as it goes along, and it goes beyond what is acceptable to people in this country.

Mr. Rifkind My hon. Friend is certainly correct that in one crucial respect the European Court of Justice is unique: it does not, as an international court, simply determine the rights between Governments or states, but can intervene directly and create rights for individual citizens of member states. We cannot hide from the fact that the UK Parliament agreed to give it that power. When we joined the European Union, it was an existing power that the European Court of Justice had. It is not a power that has been imposed more recently.

Several hon. Members rose -

Mr. Rifkind I give way to my hon. Friend the Member for Stafford (Mr. Cash), but then I must make progress.

Mr. Cash There was, of course, the European Communities Act 1972, but does my right hon. and learned Friend accept that since then we have been giving way more and more powers by successive treaties? The real point that we must address is that the European Court of Justice adjudicates over those functions, and the only way in which we can resolve that is by repatriating the powers that have been given away, which would deal with the very point causing so much concern - the political nature of the European Court of Justice. Repatriation - yes.

Mr. Rifkind My hon. Friend grossly over-simplifies the situation, because he does not take into account the fact that if we - as a Government and a country - believe in the single market, it is necessary for that single market to be enforced, and that requires the European Court of Justice and the Commission to continue with many of the powers that they currently have.

Mr. Dykes Will my right hon. and learned Friend give way?

Mr. Rifkind No, I must make progress.

I have been referring to the achievements that have been realised over the past 17 years. In some areas, we have led the debate within the European Union; in others, where there was a specific British interest at stake, we stood out alone to protect that interest. The budget rebate, the social chapter opt-out, our opt-out of the Schengen agreement and our opt-out of the single currency give us the choice when the time comes to decide.

The Government believe in European co-operation, but not in ideologically motivated integration, which is the preserve of the European purist. Opposition Front Benchers have become instinctive integrationists. The whole purpose of the Leader of the Opposition's excursions abroad has been to reassure their socialist partners in Europe that a Labour Government would be more willing to deepen integration in a manner that we believe to be fundamentally against the British national interest. It is not just that the Leader of the Opposition talks about "never being isolated" in Europe. That phrase in itself is a massive hostage to fortune in the context of the hard, tough negotiations ahead. The Labour approach is as naive as it is potentially damaging to our interests.

There is a real fault line between ourselves and the Opposition on European policy. For their part, the presumption is for integration. For the Conservative party, the presumption is against integration unless we can be convinced that the national interest is served and that the benefits of greater integration would be sufficient for our quality of life and for employment that it would justify the loss of some national decision making.

Within weeks of the final possible date for a general election, the intergovernmental conference will conclude at Amsterdam. [Interruption.] The electorate will have to decide who they believe will better stand up for British interests at Amsterdam.

Madam Deputy Speaker (Dame Janet Fookes) Order. I am tired of the running commentary coming from hon. Members on the Benches further from me. I should be grateful if they would keep quiet.

Mr. Rifkind The differences between the two Front Benches and between the two parties are substantive and very real in the context of decisions at Amsterdam.

What weakens the United Kingdom's position in Europe is the possibility of an alternative Government who is committed to giving up many things from which we have fought hard to protect this country. We are guided by the national interest: the Opposition seem to be guided by what others in Europe want.

Labour has proposed to extend qualified majority voting to four new important areas of policy: social, industrial, environmental and regional. It is an extraordinary negotiating position to offer up major concessions to integration before the real work of the intergovernmental conference has even begun. It also displays a Labour naivety that has not been matched by European Governments.

Each member state was asked by the presidency to put forward ideas on where qualified majority voting should be extended, but only two countries out of 15 put forward specific proposals. Thus, in the game of poker that the Prime Minister talked about on Sunday in his television interview, Labour has already shown its hand. Its inexperience and folly are unmatched in Europe.

Labour would give up our opt-out on the social chapter. Despite Labour's attempts to reassure business, we all know that that would be a blank cheque to open up new routes to social regulation and integration, which would profoundly damage Britain's competitiveness and job prospects. It is truly a job-destroying chapter. How ludicrous it would be to sign away our competitive advantage at a time when unemployment is 7 per cent. and falling in the United Kingdom, and 10 per cent. or more and continuing to rise elsewhere in the European Union. There is a fundamental philosophical and political divide between us and the Opposition, in that they actively want to conform to a European social model that is shown, day by day, to be well past its sell-by date and damaging to Europe.

Similarly, Labour has fallen head over heels for writing an employment chapter into the treaty. It is no use the Labour party saying, "That would mean nothing, so don't worry because it's only warm words." That is dangerous enough in itself. Why raise people's expectations that the European Union has some magical wand to cure Europe's unemployment ills, when the policies currently being pursued under the social chapter are creating the opposite effect?

However innocuous the words, we are long enough in the tooth and wise enough to the realities of life to know that by proposing Community competence we would deprive Britain once again of taking decisions on what is a matter for this House and this Parliament. Not only would an employment chapter not create a single job: it has the potential to destroy many of them.

Labour want all legislation currently decided on by qualified majority in the Council of Ministers to be subject to a simplified form of co-decision in the European Parliament. Every increase in the powers of the European Parliament reduces, by definition, the powers of this Parliament. That would not enhance democratic accountability: it would merely centralise more powers, taking them out of the hands of the elected representatives of this House. It would be another step on the slippery slope which says that European centralisation should become the natural order of things.

An intriguing, growing divide is emerging between the Leader of the Opposition, his shadow Chancellor and his shadow Foreign Secretary. The Leader of the Opposition said boldly that he would never allow this country to be isolated". Yesterday, The Times reported the shadow Chancellor as saying: We are not afraid of isolation in Europe". Who are we to believe? Is the Leader of the Opposition isolated in his shadow Cabinet, even if not in Europe? Or does the soi-disant "Iron Chancellor" speak for Labour? We need to know.

Then again, the redoubtable shadow Chancellor rebukes the Prime Minister for daring to suggest that Labour would give up the veto. He protested on the "Today" programme: It has got to be made absolutely clear that any question of giving up the veto is a myth that is perpetuated by the Conservative Party. Well, if it is a myth, it is not being created by the Conservatives. It is a myth being spread in a most sinister fashion by the shadow Foreign Secretary.

Following the shadow Chancellor's protest, the shadow Foreign Secretary declared: If you want reform, frankly in many cases you do have to have majority voting". He confirmed that Labour would end the veto on social, regional, environmental and industrial policy. He stated quite boldly: There will have to be some majority votes against those individual nations that stand in the way". What if those individual nations included Britain? On that, there was a resounding silence.

The shadow Foreign Secretary and the shadow Chancellor should reconcile their differences. Perhaps we need a conciliation service. Alternatively, we could return to the device used during Harold Wilson's referendum on Europe, when Labour Cabinet Ministers were licensed to attack each other throughout the length and breadth of the country.

Yet another damning admission by Labour was its declaration that it rejected permanent opt-outs. That has alarming implications. It has revealed to every other European Government that the British budget rebate, the Schengen opt-out to protect our frontiers and the Maastricht single currency opt-out are just temporary aberrations to be abandoned by a Labour Government in due course.

The Opposition, through their inexperience and naivety, have become a menace to Britain. They are weakening Britain's position in these crucial negotiations by encouraging other Governments to wait until after our general election in the hope that some of their crucial negotiating objectives will then fall into their laps. They are a menace, and they need to be resisted. They need to get their act together and remember the national interest. It is the national interest that will be our guiding principle in the weeks and months ahead.