The biggest issue facing the Conservative
Party is the Single Currency. Indeed I know Constituency Chairmen
who feel so strongly that they would resign from the Party if
the Single Currency were to become a reality.
I don't deny that a Single Currency has superficial attractions
for the millions of tourists who go to the Continent each year
who would find it easier if they didn't have to change pounds
into other currencies; for business men who wouldn't have to hedge
their business deals by making currency provisions in advance
and perhaps even for the dreamers who see the ECU one day rivalling
the mighty dollar as an international exchange.
People speak about the economic argument
for a Single Currency as though that was the only argument. They
conveniently ignore the constitutional argument as though it has
no relevance at all; and so it was good to hear the Prime Minister
tell the House of Commons for the first time on the 7th February
that there is an important constitutional issue at stake.
But there is another argument. Beyond the
economic argument and the constitutional argument there is an
argument which scarcely dares breath its name - and that is the
argument about the effect of a Single Currency upon the Conservative
Party.
I intend to speak firstly about the economic
argument, then secondly about the constitutional argument and
then finally about the effects upon the Conservative Party. The
economic argument for a single currency runs something like this:
we cannot afford to stand aside; we cannot afford to watch others
go ahead without us; we cannot afford to miss the opportunity
to help shape the future structure
All the same old canards that were advanced
in favour of joining the Exchange Rate Mechanism because it was,
so we were told, the only way to keep inflation down, the only
way to keep interest rates down, the only way to keep unemployment
down. And what was the result? The result was the absolute opposite!
When we joined the ERM in October 1990 unemployment,
for example, stood at 1.67 millions. By the time we unceremoniously
left the ERM, barely two years later, unemployment has increased
by 70% to 2.85 millions. Now there aren't many votes in that for
the Conservative Party!
But let me instance another fact - by 16th
September 1992 (variously called White Wednesday or Black Wednesday
depending upon your perspective) interest rates had risen, in
the morning of that day, to 12% and would have been 15% by evening
had the Treasury had its way. And yet, within 3 months of leaving
the ERM, interest rates had halved, as we all know, to 6%! Just
as they did in September 1931 when we came off the Gold Standard.
In September 1931 interest rates were 6%. Within 9 months of leaving
the Gold Standard interest rates were not 6% but 2%.
People may say "that's just a coincidence"
- a coincidence could have happened at any time and an absolute
coincidence that it happened in the 1990s, just as it happened
in the 1920s: but look what happened to unemployment in the 1920s.
In 1925 when we went on to the Gold Standard unemployment stood
at 1.25 millions. When we left the Gold Standard in 1931 it had
risen by no less than 130% to 2.9 millions. I do not consider
these are facts that we can ignore and I invite you to consider
what has happened since we left the ERM: because in my submission
what has happened since we left the ERM mirrors what happened
when we left the Gold Standard. Unemployment has come down. It
is now down for the 14th consecutive month. Inflation has fallen:
indeed by June 1993 it was at its lowest rate for 28 years. Economic
activity has been stimulated by lower interest rates and today
the undoubted economic recovery which we are experiencing is led
by an export boom! That could not and would not have been the
case with Sterling pegged at the equivalent of 2.95 DMarks; the
consequence of which, for as long as it lasted, was that my constituents
lost their jobs, lost their homes because they couldn't afford
to keep up their mortgage payments and some of them even lost
their businesses. Frankly I am not in politics to deliver that
sort of result for the people that I represent.
And yet we are told that we must never rule
out the possibility of joining a Single Currency. By the same
experts who recommended the Exchange Rate Mechanism out of the
same stable which recommended the Gold Standard! Will they ever
learn?
Now I turn to the constitutional argument:
largely ignored but hugely important. And I don't intend to employ
the intellectual arguments of the mandarins or the smoke and mirrors
that the Foreign Office like to use - I am going to simply talk
about the practical effects upon the United Kingdom. If you pardon
the analogy I am going to say that, excluding all other considerations,
the United Kingdom is stiched together with Financial Thread and
Political Needle. To illustrate my point I am going to tell you
that in 1993 (the latest year for which figures are available)
every man, woman and child in England was funded by the Treasury
to the tune of 2,993 Sterling. Butr every Welsh man, woman and
child was funded to the tune of 3,320 Sterling; every Scots man,
woman and child to the tune of 3,500 Sterling; and every Ulster
man, woman and child to the tune of 4,239 Sterling.
Similarly on the political front the constitution
allows over-representation to the extent that there are today
15 more Scottish MPs and 5 more Welsh MPs than would be the case
if their constituencies were the same size as English constituencies.
And incidentally there would be more English MPs if the United
Kingdom were to be divided up equitably.
But that is the price we pay for the Union
of Great Britain and Northern Ireland. There is a higher price,
a much higher price, to be paid for European Union.
For centuries the regions of the United
Kingdom have looked to and sought satisfaction in the Westminster
Parliament. That is now changing. The reason it is changing is
because the European Community has money and you don't need me
to remind you that MONEY is POWER. And we also have as a result
of Maastricht a Committee of the Regions - an embryonic forum
which will encourage nationalists in their aspirations to gain
greater political power and influence in the new Europe. But the
clincher would be a Single Currency. In the circumstances of a
Single Currency, Westminster and Whitehall would be almost entirely
bypassed. Under a Single Currency there would be but one Chancellor
of the Exchequer; and I hazard a guess that the same Chancellor
would not be residing at 11 Downing Street. Economic policy would
be decided by the Council of Ministers, relegating national Parliaments
to the status of rate-capped National Assemblies.
Under those circumstances the Regions will
inevitably expand their representative offices in Brussels because
quite simply they will follow the money - and who can blame them
for that!
And what is the consequence of all of this
for the Conservative Party? Like the King without any clothes,
all that will be seen is our nakedness. No longer able to pretend
that we are a great national Party which sustains Parliamentary
Sovereignty; which defends the Union of Great Britain and Northern
Ireland; which can deliver competitive tax rates; which can have
any semblance of an independent Foreign and Defence Policy. No
longer a Party that upholds the principles of democratic accountability
and the right of British citizens to make their own laws in their
own parliament; to raise their own taxes and to protect their
own national interest.
A Single Currency and Conservatism are mutually
exculsive. They are a contradiction in terms.
Conversely a Single Currency and socialism
are not. In the hands of socialists a Single Currency would be
more powerful, more dangerous and more destructive than ever Clause
4 was! It delivers the single instrument that makes a virtual
reality of controlling the means of production, distribution and
exchange.
A Single Currency will destroy the
economy, destroy the Union of Great Britain and Northern Ireland
and destroy the Conservative Party. Now is the time to end the
years of deception, to expose the deceit for what it is and to
give the British people hope for the future.
