Sir David English and Gordon Grieg, Daily Mail
This is about Europe. Some confusion seems to exist on what the future of Europe is, as seen by different Parties, and the effect of that confusion within the Conservative Party and its supporters itself.
So let me ask you to begin with, there seem to be three versions of Europe. One is yours, a Europe of sovereign states, independent mutual cooperation; one is Delors' version which you have taken up of a socialist, corporate Europe, and then there is a sort of middle Europe which Henry PlumbPlumb was talking about, which is that the sovereign states are gone, anyway the Single Act to a certain extent we have pooled some of our sovereignty, we have agreed to share it, and that the threat of a socialist Europe is really not a real one because we can always veto monetary union and political union. [end p1]
So therefore there is a middle ground and we really ought to be in the middle ground, shaping Europe our way in that middle ground, and I think the criticism is that we are not actually doing that, that we are perhaps pushing ourselves on the outside and not getting into the middle ground, the high ground and seizing it.
Prime Minister
I would think that since we entered, this country has done more to shape Europe in practical terms in the generally right direction than any other country.
Let me put it this way. When we went into Europe, that is when the law was passed in our Parliament which enabled us to go into Europe, you did in fact automatically pool some of your sovereignty by virtue of that decision. Of course you did. You joined a Common Agricultural Policy, that was pooling your sovereignty. We have absolutely no authority ourselves over trading matters, that was pooled in Europe. Certain other things were pooled in Europe and on the whole then the arrangement was that you had a veto, although certain things were still done by majority, such as, for example, selling surplus butter cheaply to the Soviet Union was done by majority. [end p2]
So right from the beginning you pooled some of your sovereignty and you did things by discussion. The Common Agricultural Policy is perhaps the biggest factor.
Now let me say, when we came into power in 1979 we were left still with no common fisheries policy, that had been set aside, it was too difficult for anyone else to negotiate. Do you remember when we went in? Too difficult. It was not negotiated by the Labour Party - too difficult. We negotiated one which did reasonable justice to our fishermen, which is my duty because I am bound to our Parliament, which also respected the historic rights of other fishermen in Europe in our waters.
We negotiated that, the Government which I have led, negotiated that, which every other government had shrunk away from. We started to modify the Common Agricultural Policy for the simple reason it was producing surpluses of food which no-one wanted and half the budget was going not to the farmers but to surpluses that were rotting and then being sold cheaply to the Soviet Union.
We were the first government actually to tackle that, take the argument to Europe, we have done battle on it, we now at last have a reasonable budget for a Common Agricultural Policy which we cannot exceed, and if you look the surpluses are coming down and everyone is very glad because no-one likes us to produce surpluses when half the rest of the world is hungry and the stuff is just kept in store. [end p3]
We are now tackling fraud in the Common Agricultural Policy because of British policy that you had an Audit Office to have a look at some of these things.
So first we got a Common Fisheries Policy; second, we have been the first and leading country to tackle the Common Agricultural Policy; third, I was left with a rotten deal as far as British contributions were concerned, a really rotten deal, Germany is the biggest contributor to Europe but she gets the most out of it because East Germany is treated as a European state as far as trade is concerned, so she has a privilege that no-one else has in the whole Community. We are still the second biggest contributor. This year we are contributing to Europe, net, that is to say we pay for everything that Europe spends here, everything on the Common Agricultural Policy and after that we contribute £2 billion this year to Europe. That actually happens to be more than we contribute to the Third World.
But if we had not got the sort of deal, which we got through continual and steady fighting on the ground of reasonableness for Europe and justice for Britain, we would be contributing about £3.5 billion this year.
Now also, let me point out, that in the Treaty it says there should be free movement of capital. We have it. Germany has it. France has not, most of the others have not. The Treaty says that there should be free movement of some services. We are the most open city in London in Europe. We do not get the freedom for some [end p4] of our insurance in the other countries that we extend in finances to other people.
If you are to have free movement of capital you must have freedom from foreign exchange control, we have it. If you are to have a genuine Europe, which is what I want, then ships must be able to pick up trade in any port in Europe, they are allowed to do so in Britain.
And so when others castigate me, I do just sit back a little and say: “Well now look, we tackle the Common Agricultural Policy, we have tackled the finances, you are not yet coming up to us in free capital movements, you have not yet got rid of foreign exchange control, you will not let our ships pick up business in your ports, as we let yours pick up business in ours.” We have been trying because we are one of the few countries in Europe that speaks for the consumer.
This is very much the case with the Common Agricultural Policy, it is very much the case with things like air fares. You have seen what they are doing in Europe at the moment, a regulation on what you should put on a cigarette package. Why do they not tackle competition in air fares as we have been urging them to do?
In order to get competition in air fares, we have now had to go not through the European Community but through bilateral arrangements because Holland felt the same way as we did. There is a cartel still, so we have not broken that down. [end p5]
No, we have the true practical vision and when it comes to practicalities they cannot fault us because we are ahead of them and we are always saying: “Right, you talk about Europe, we are doing a better Europe. Why are you not dealing with air fares and so on?”
We believe that you get a prosperous Europe, that that original Treaty was a Treaty of economic liberty. Of course it was. Therefore that you get growth, prosperity, more jobs by a free enterprise Europe not tied too much in regulation, more than you do by a centrally controlled Europe. That is the lesson the world over.
So of course I am trying to say there precisely the things which we have done here. That is a pretty good record, David EnglishDavid, if I might say so and if they concentrate on some of the practical things that we have already done instead of a whole lot of small regulations, then I think it will be very much better.
It will be more our vision of Europe and let me, because I want to get as much on the table as I can in this, and just remember you do not put a great big fortress line around Europe and cut it off from the rest of the world. Now that is what some people are concentrating so much on Europe that they are doing.
We have to compete in the world markets. We have to compete with Japan, the goods from Japan, we have to compete with the goods from Korea, we have to compete with the goods from the United States, we have to compete with the goods from Singapore, Hong Kong, Taiwan, Australia. We have to watch the effect on what we do on [end p6] their agricultural economies. We have to watch that if we put a tax on oils and fats, as some people wanted to in the Community, to have more protection for the Community, that they would be undermining our trade with the United States which would have retaliated, that they would have undermined some of the Third World countries who can only export food to us.
We have a vision of a Europe playing a big part in a wider world, not as a protectionist, not upsetting the agricultural economies of the Third World because we want to put import taxes on. We want to play a full part in the GATT as well. We have had to battle that we are prepared to deal in agricultural matters in the GATT, the general agreement on tariffs and trade.
We had to battle that because we have got to trade in the wider world. We are trying to get tariff barriers down over the whole world. It would be so ironic if, by trying to get them down, internally in Europe you were putting them up against the wider world.
We have been I think the most ardent speaker for the consumer in Europe. We have also done our part in other things, European Cancer Week, I do not know of any other Prime Minister that went and opened European Cancer Week in her own country, or his own country.
So, yes we pooled some of our sovereignty when we went into Europe. Yes we pooled some more of our sovereignty under the Single European Act in order to get free movement of trade and services, genuine, around Europe. And we are a lot freer than many of those other countries in Europe. [end p7]
All right, let me give you one other example. We rely on the Commission to see that when it comes to fair competition, that other countries are not allowed to subsidise their industries more than we are. Now it is about time they tackled that because they are not. Germany subsidises more than we do, Italy subsidises more than we do, France subsidises more than we do.
These are big things they should be tackling because it is unfair competition. We rely on them to see that there is genuine free movement of goods. We had to work with the Commission because when we had a colossal amount of inward investment here, because Britain is not a highly regulated nation so they prefer to come here. We have Nissan - a great coup for Britain - because we are both the country we are, minimal regulations, a framework of regulations on safety etc on certain things, but not over-regulated, and that they can export to Europe from here.
What happened? What happened to people who criticise me for being non-communautaire in Europe? France said: “We are not prepared to accept Nissan cars from Britain except against France's quota against Japan”. Communautaire? Really! It was we who went to work with the Commission and said: “This is not free circulation of goods.”
We, Britain, keep the rules, that is our nature, and we are not going to be a country that keeps the rules when others do not. All right we fought. You criticise me for fighting. We fight and we win and so now, yes, France has accepted. [end p8]
And we fought with the Commission that Nissan cars made in Britain have to circulate freely in the Community. But we had to fight for it.
Now we have, I see some people say yes, they are looking after subsidies, so when we have had industries that have got colossal losses, as British Leyland and Rover and British Aerospace was purchasing them but they could not purchase them unless we cleared quite a lot of the losses. You had to have a dowry in other words, to give a dowry, because the losses were so colossal, built up year after year as Government had guaranteed every single overdraft they ever had. So we had to negotiate that with Europe. Quite right and I do not mind that so long as everyone else has to negotiate it with Europe because that is what a common market is and that is what we joined it for.
And so when they said no you cannot have £800 million, it has to be £650 million, right, we agreed. Renault did the same thing and the Commission said no, that is too much. And the position has yet to ge resolved. So of course we are into the Commission: “It is no good you telling us what we have got to do and we do it and then when you tell the French they have got too much, letting them get away with it. That is not fair.”
Now this is the most active role in the big European things and no country has played a more active role in those things than we have. [end p9]
And one other things, and I tell you there is a great tendency for Europe to be protectionist. As I told you, there was a colossal attempt by both the Commission, aided and abetted by France and other countries in Europe, to put a tax on fats and oils coming into Europe.
Now it was Germany, ourselves and Holland that fought that off. We three stood together and fought the rest, first because your prices would have gone up, then because every other country would have retaliated. They could have retaliated on Scotch Whisky being imported into their countries. We fought that off, and that is the inherent protectionist thing.
Now they they have stopped beef coming in from the United States containing a certain hormone. Now this is not the hormones which we stopped in Europe, this is a different one and the scientific reports from both Europe and from the United States say that is not harmful in any way. Nevertheless, on a majority vote, we voted against stopping it from coming in because those hormones are harmless, and on a majority vote they stopped it from coming in.
Now that is a protectionist measure masquerading under the terms of a health measure because the scientists say it is not harmful and we accept that and so do Europe.
Now we had to be very very active that we did not get a trade war developing with the United States and we had to calm the whole thing down because the United States will take some retaliation, of course she will, she is entitled to under the trading rules for the wider world. [end p10]
And so far we have been instrumental in calming that whole thing down, instrumental over in the United States and in Europe because there is a great tendency for Europe to go protectionist.
Now we are not, we are as I say an open country, we abide by the rules. Now do not let anyone from any previous government or in any other country in Europe accuse us of not doing our bit for an open, visionary Europe, with all of the best in Europe, a Europe that fought for liberty, not to be tied up in so many regulations.
The tobacco thing, the thing on the packet, it is not worth making a song and dance about. Its significance is the extent to which Europe will go on detailed intimate regulations and that is its warning. On its own it is not worth fighting about and I cannot think why you are making quite such a fuss about it.
Sir David English and Gordon Greig,Daily Mail
… lots of other things like that too.
Prime Minister
It is worth fighting on the big things and I have fought and will fight on the big things, of course I will.
Let me tell you something else the European Community - we will have to fit in some questions to this, David EnglishDavid, I do not know how you are going to do it! - let me tell you some other things, when we had the Single European Act I was the first person to raise to the [end p11] Single European Act. Yes, you want free movement, we joined Europe to have free movement of goods around, we joined it for that.
But I was the first person, I remember vividly doing it in that room, and saying: “But I did not join Europe to have free movement of terrorists, criminals, drugs, plant and animal diseases and rabies, and illegal immigrants”. And so we got a Declaration, you will find it, a Political Declaration, I instigated it and the others agreed it. “Yes”, they said “Yes, we agree”. So we will make a declaration, it was the minute of agreement of all Heads of Government, and this is it.
“In order to promote the free movement of persons, the Member States should cooperate without prejudice to the powers … in particular as regards the entry, movement and residence of nationals of third countries. They shall also cooperate in the combatting of terrorism, crime, the traffic in drugs and illicit trading in works of art and antiques.” Someone else put that in, I think it was not me. And then: “nothing in these provisions shall affect the right of Member States to take such measures as they consider necessary for the purpose of controlling immigration from third countries and to combat terrorism, crime, the traffic in drugs and the illicit …”
Now that is there, it is a Declaration. I took it as made in good faith and to this day I am still saying to them: “Now how are you going to? You want to stop all checks and controls on borders, [end p12] how are you going to stop a terrorist?” Recently they have in fact apprehended some people who are suspected as terrorists, just at border controls. How are you going to stop it? I did not join Europe to have the free movement of criminals, terrorists, drugs, plant and animal viruses and rabies.
Sir David English and Gordon Greig,Daily Mail
They say you can stop it by a sort of European-wide international cooperation in police and information.
Prime Minister
How are you going to stop a person coming in on holiday in Greece going right through Europe, without any border controls of any kind, any checks of any kind, quietly coming and taking up residence here?
Now fortunately there are some other countries also as much concerned, Germany now and Holland. But they have not in fact set up any kind of checks.
Now there is a difference here. We have our internal borders, that is our ports, are our external borders. To some extent it is so in Holland, to some extent round their shores, but we traditionally have had our checks because our coastline, because we have a coastline all round our shores, traditionally we have [end p13] had our border controls, we traditionally check rabies so that it does not come in, border controls. They simply must take account of this.
In Europe they have tended to have, in France you have to carry an identity card, cards and you have to carry it everywhere so that police can challenge you anywhere. Now they simply must take account. It is reasonable to ask them to take account of our particular position, also Denmark to some extent has the same, she has a small border but she has to some extent the same position, Holland.
But they are not getting down to how they are going to do that because the main apprehension at the moment is as you go through you have, as we do, you have a check when you come into an airport, you have a check for all overseas visitors, foreign visitors, but you have a special passage for European, people who come from Europe and as you know we have a common form passport so it makes it easier to check. But if you are going to get rid of those checks it is going to be very difficult for us to apprehend terrorists, criminals or drugs.
They have accepted that, they have accepted that, they have agreed it, it is appended to the Single European Act. We accepted the whole Single European Act with that in good faith. [end p14]
Sir David English and Gordon Greig,Daily Mail
So what are you accusing them of, bad faith?
Prime Minister
No. What I am saying is you have got to turn that in practical steps into reality and do you not think that is more important, do you not think with crack possibly coming into Europe that that is more important than some of the small regulations you are doing?
This was agreed to in good faith. It is vital for every single citizen in the Community. Right, that has not yet been worked out in practice. So, as I said in my Bruges speech, we are practical, as I told you some of the things where we are ahead of Europe, and even if they do their identity cards, can you imagine compulsory identity cards have to be challenged in this country by the police anywhere? We recoil from it. They are used to it, they have a different system, but I hope they are not going to say that because our position is slightly different, we have never done that, and because we are a separate region, because all our external borders except the ones with the Republic of Ireland are bounded by the sea, that we cannot in fact have our thing.
And what are they going to say about rabies? Are they going to say that you simply cannot have external border controls? I am sorry, that is not necessary, it is not necessary. That would be regulation and power for the sake of power. [end p15]
We have kept rabies out of our country. We have kept other plant and animal diseases out.
Now the final thing. On the Single European Act we thought that the things that are on, total unanimous voting, including fiscal ones and industrial policies, also include plant and animal health. That was what was in my statement to Parliament because that was what I firmly believed.
There has been one decision of the European Court since then which casts doubt on that. It actually happened to be on the beef hormones. But now whether that will obtain for others or not, in which case we are driven back to the Luxembourg Compromise.
But it is quite possible to reconcile some of the separate historical different national interests with one another, just as we were prepared on a fishing agreement to recognise the historic interests on fishing grounds in the National Fisheries Policy.
So we have got to turn this, passed by every one of the Heads of Government, into a practical policy. Fortunately, perhaps not fortunately, Germany also at the moment is having great difficulty with the number of immigrants she is getting in so she too will now be much more concerned with this.
Sir David English and Gordon Greig,Daily Mail
The other thing on borders, on the &dubellip; Agreement with France and Benelux, before 1992. [end p16]
Prime Minister
Yes indeed but you see she is having a real practical problem is she not? 500,000 immigrants have crossed into Germany, she is having a real practical problem. But I hope that you are not suggesting that because we are not turning this into practical arrangements, that anyone can come in from Bangladesh, from any country, come for a holiday in Greece, come right in, right across all borders, no controls, and settle in Britain and we have no means of finding out.
Sir David English and Gordon Greig,Daily Mail
Presumably if we had identity cards we could find out, or passports, presumably we can ask for passports, that is a means of finding out. If they have not got a Common European Passport then they have no right to settle here.
Prime Minister
But I am sorry, if there are going to be no controls at the border, how are you going to find out?
Sir David English and Gordon Greig,Daily Mail
Well, presumably you can knock on the door and ask can't you? [end p17]
Prime Minister
I see, and how are you to know which door to knock on?
Sir David English and Gordon Greig,Daily Mail
Well, this is the whole point. There is supposed to be an intelligence movement on this sort of thing, presumably the same as in America, the Immigration Department of Information knock on doors.
Prime Minister
I see, and how are you going to know? You have people sweeping off the ferries, sweeping off the aircraft, they go through no immigration controls because they have come from Europe and where are you going to know where they have gone to? The total numbers that come in a day, I just want to know, David EnglishDavid. Is the Daily Mail policy that we should have compulsory identity cards, that you have to carry with you everywhere on challenge of police?
No, what I am saying to you is my way is very much better, that we simply must make practical arrangements for, at the moment we have, quite rightly, a special group of people with European passports so you get the freer movement. The free movement to me in that European Community is among, between the peoples of Europe. It is not meant to be an open door to anyone from the outside world who chooses to come and take up residence. [end p18]
Sir David English and Gordon Greig,Daily Mail
I actually agree with that, of course we do not want to be swamped by immigrants, everyone would agree with that.
Prime Minister
What I am saying to you is, how are you going to turn it into practical policy? Because you have got to face that problem and I am suggesting that we actually turn round to face it now. We have not got one yet.
Sir David English and Gordon Greig,Daily Mail
But then in theory then we ought to maintain borders at all countries and not open up the borders of all countries. If that applies to us, it certainly must apply to everybody else.
Prime Minister
What they in fact will suggest, what we would suggest is that any external port or at any airport you simply must retain your controls because this is where they come in from international.
Sir David English and Gordon Greig,Daily Mail
Are you suggesting throughout the whole of Europe? [end p19]
Prime Minister
Yes and also that if you happen to have a coastline that you should in fact have controls at that coastline. But I do hope that you accept we have got to have a system which works.
What I am saying to you is, David EnglishDavid, we have got to get down in Europe to doing the practical arrangements and this is much much more important than some of the other things.
Sir David English and Gordon Greig,Daily Mail
And that means in immigration and customs does it, controls?
Prime Minister
I am just very interested to know, well they have got a new system for VAT, they are working out a new system for VAT, that has to be worked out practically now because at the moment you see you do your imports, we do it at the ports, we do all our VAT controls at the ports and at airports. So we have got to have a new system worked out, they are looking at a new system for that. [end p20]
Sir David English and Gordon Greig,Daily Mail
Looking at all this and what you have said, and I accept quite a lot …
Prime Minister
There are a lot of practical things to be worked out, and we are working on them hard.
Sir David English and Gordon Greig,Daily Mail
&dubellip; but this is the great dilemma. While we accept what you say, in order to say it, it actually induces the kind of them and us, anti-European feeling. [end p21]
Prime Minister
It does not, David EnglishDavid, no it does not! That is what you are creating, it is not me. Are you suggesting that I do not fight for British interests? British farmers are rather different from other farmers. I cannot ignore that, our family farms are bigger than their family farms. We cannot in the Common Agricultural Policy ignore the interests of our farmers and so we do go and fight in Europe for our farmers. Are you suggesting that just because I fight for our farmers we are anti-Europe? Certainly not.
Sir David English and Gordon Greig,Daily Mail
What I am suggesting is that the list of things that you have said to me about them cheating on subsidies, them having one rule for themselves …
Prime Minister
No, I have not said they are cheating on subsidies. You must not put &dubellip;
Sir David English and Gordon Greig,Daily Mail
Not cheating, but they are using subsidies, they are getting one rule for themselves under Renault, we are obeying the rules and they are not, so &dubellip; [end p22]
Prime Minister
So what I have said, and just take the whole thing, is that we are taking this up with the Commission because this is necessary for a Single Market. The Single Market comes in at 1992 and all of these things will have to be dealt with by then.
Sir David English and Gordon Greig,Daily Mail
Well I agree but these are not the things they appear to be not doing fairly and we are but that must induce, even as I listen to you, I get an anti-European feeling. Well, why are these people doing this, why are the French trying to get this for themselves, why is Germany, Italy and France …?
Prime Minister
David EnglishDavid, I am sorry, but are you suggesting that there is one rule for some countries in Europe and another for another? There is not David. We have got until 1992 to sort it out.
Sir David English and Gordon Greig,Daily Mail
No, I am not, I am not suggesting that, I am saying it is inducing an anti-European feeling in me in that they are breaking the rules and we are not. [end p23]
Prime Minister
What I am saying to you is that when the Commission comes to us and tackles us, we obey them. They have had fewer infraction proceedings against us, correct?
Official
(Inaudible).
Prime Minister
There have been fewer infraction proceedings against us and anyone except Denmark.
No, what I am saying to you David, really in rather passionate tones, is that we are really rather good Europeans.
Sir David English and Gordon Greig,Daily Mail
Better than the others?
Prime Minister
And we are expecting the same rules to apply to them and we hope that they will give attention to this in preference to some of the detailed regulations which they are pursuing at the moment because that is necessary for what we joined Europe for, which is a Single Market. [end p24]
Sir David English and Gordon Greig,Daily Mail
But we signed away our right on these cigarette things did we not in the Agreement.
Prime Minister
Signed away what?
Sir David English and Gordon Greig,Daily Mail
Our right to sort of veto, once we gave a qualified majority on …
Prime Minister
No, there are certain things which are absolutely unanimous voting.
Sir David English and Gordon Greig,Daily Mail
Yes I know.
Prime Minister
That was modified for one purpose only, there are certain things which are always majority voting, for example the handling of the export of surpluses was always majority voting, on the management committee it was always majority voting. [end p25]
Then, in order to get the things through in time by 1992 we all agreed that certain things should go by majority voting, but not of course fiscal things, as you know.
Sir David English and Gordon Greig,Daily Mail
Exactly …
Prime Minister
Not of course fiscal things.
Sir David English and Gordon Greig,Daily Mail
… there is really not much we can do about this irritation of cigarettes, as you said yourself.
Prime Minister
No there is not, no there is not, that is why I say it is not worth fighting about. Except but it is, what I am trying to say to you David, is it is, its most significant thing is as an indication of the detail which they are using, this Article 4, which I had just never contemplated, just never contemplated, that they would go to such intimate detailed regulations.
It is not worth fighting about. If they were attempting to overrule anything on fiscal independence, that would be. I thought, as I said to you, that animal and health, which are absolutely vital for our farmers, animal and health matters, absolutely vital, [end p26] we do not have some diseases here because we are separated from Europe. And the idea that you should not be able to have import controls in order to keep some of your things disease free, as they are now, I thought, and came back from that Agreement, and said to you we retain authority over that. There has been one court case in Europe which would cast doubt and has taken it not under Article 100 but under Article 43, which is not what we thought, that is interpretation. But it is important for us here, animal health.
But the other things we have agreed, but it is only for one purpose and for one purpose only and that purpose of the majority voting is to ensure that the Single European Act can come then.
Sir David English and Gordon Greig,Daily Mail
Is that covered in Article 118 which talks about employment, labour law, working conditions, social security, is that not going to be by a majority vote?
Prime Minister
One moment, I have not got 100A here.
Sir David English and Gordon Greig,Daily Mail
118. [end p27]
Prime Minister
Yes, one moment, the one that gives majority voting is 100A. You see Article 100 was unanimous voting. The one that gives you majority voting is 100A, by way of derogation, have we got it? “… the following provisions shall apply to the achievement of the objectives set out. Council shall have, acting by qualified majority … (inaudible) on proposals from the Commission in cooperation with the European Parliament and (inaudible)”.
Sir David English and Gordon Greig,Daily Mail
I know that but I am talking …
Prime Minister
So those relating to the free movement of persons, so that should be all right, and also those relating to the rights and interests of employed persons. So we still retain unanimity on that. There will be some argument as to the limit of those things.
And we also thought, were given to understand, that animal and health things, we would still be, but that I think we would have to do by the Luxembourg Compromise.
Sir David English and Gordon Greig,Daily Mail
Can I ask about 118 which specifically says employment, labour law, working conditions, basic and advanced vocational training, social security, the prevention of occupational acts and diseases, occupational hygiene, the rights of association and [end p28] collective bargaining, that is all social contract stuff I guess, as I read that in the Act, Article 118A, Section 2, talks about that being of qualified majority. That seems to me that we are going to have a hell of a row over all of that.
Prime Minister
Here, you have got here, that anything which affects that of employed person shall be by unanimous vote. Now you may get, you may get …
Sir David English and Gordon Greig,Daily Mail
Conflict over that …
Prime Minister
Well this is one of the problems but David EnglishDavid, I am sorry, what I have been so anxious to tell you, that we are in fact acting pretty communautaire when other people are not really at liberty to challenge us on that. I am sorry that I have been so anxious to do that.
Sir David English and Gordon Greig,Daily Mail
No, I got that. What I really need to ask is how are you going to, your vision, which I accept, how are you going to persuade the rest of Europe to go along with our route because you said there are a lot of battles to fight. [end p29]
Prime Minister
But look David, with all due respect we have persuaded them on the Common Agricultural Policy because of the validity and strength of our arguments.
Sir David English and Gordon Greig,Daily Mail
But I am talking about the arguments to come.
Prime Minister
Yes all right, what I am saying is that you have got to look at that, we have persuaded them on the finance, on the Common Agricultural Policy, on a budget for the Common Agricultural Policy, persuaded them again on Oils and Fats Tax, we could not have done it alone, we got enough other countries and we stood against those who where protectionist. We have now calmed things down on an international trading war on the beef from the United States.
You win by two things. First, because you are prepared to stick out your chin and sometimes you know full well that other countries are with you but they will not lead with the chin but they expect you to lead with the chin and then they will quietly come in. We quite often lead with the chin.
And then we get, there are other people just as much interested in the immigration one, I think every country now is interested in curtailing the movement of drugs. [end p30]
Sir David English and Gordon Greig,Daily Mail
Do you think you could persuade them, actually turn them back to this idea of frontiers and get them to introduce passport and immigration controls in their airports?
Prime Minister
We are going to have a common form passport, it is not a Euro-passport. Now we agreed a common form passport, we agreed a common form passport I must say against a great deal of opposition in this country. I used to carry it round with me in case I was asked about it in the House of Commons, pointing out that it is Her Britannic Majesty's Passport and in common euro form.
Excellent, and that is just precisely what is meant to make freer movement of peoples, European peoples, around Europe. It goes straight under a computer and you are through. Excellent, we did that. That is just exactly what it is all about.
We agreed from about 100 …
Sir David English and Gordon Greig,Daily Mail
(Inaudible).
Prime Minister
That is what we do.
Sir David English and Gordon Greig,Daily Mail
No, but in Europe. [end p31]
Prime Minister
I think you have to. All international airports, I think that is vital.
Sir David English and Gordon Greig,Daily Mail
What about non-international airports?
They are all intending to keep them, there is no problem with international airports.
Sir David English and Gordon Greig,Daily Mail
No, international airports coming in from outside, but at the moment it is an international airport between London and Frankfurt or, if you like, London and Athens.
Prime Minister
Yes, but we want to keep them as international airports. Then, you get in an international airport and then you are just going to come and you get out of a car, you will have come in, not through the European channel but you will have come in through another channel, you get in the car and you just come in and you travel anywhere in Europe without any further barrier to looking at who you are, then it is going to be jolly difficult. [end p32]
But also it is going to be jolly difficult for other countries, this is why we have to find some way …
Sir David English and Gordon Greig,Daily Mail
I see this, I mean I want to be absolutely precise &dubellip;
Prime Minister
We have to find some way of doing it and we have not found it.
Sir David English and Gordon Greig,Daily Mail
But you want to persuade these other European countries to keep their controls within their internal airports …
Prime Minister
They have, because you can get in a car in Luxembourg and just drive, because they have been used to doing it for years, but they have, and in France, they have their method of control by compulsory identity cards some of them, which you have to carry all the time on challenge.
Now I do not think it is reasonable to impose that on us when we, by virtue of being differently geographically situated, having a much easier means of control through ports of entry and through any airport, can operate our system of control which is much more in keeping with our traditions. [end p33]
And the thing is that we each operate a system of control that is acceptable to the other, not necessarily that we have the identical system.
There is a precedent for that David. On qualifications we have not got the same qualification for medicine all the way across Europe. We have each agreed to accept the other's qualifications. There are several things and we have done that because that is the quickest way of getting free movement for young people that all right, if the medical qualifications are good enough in one country we accept them in another. There are other things which we have also done that with.
But we have accepted one another's standards on certain things, on certain things we have to have common standards. You have to have common standards for television and for electric plugs and so on for goods.
Sir David English and Gordon Greig,Daily Mail
What about financial services, do you want common standards for those?
Prime Minister
There are certain things which you have to have common standards for, others which you do not. Now they there are introducing a particular regulation - can I just finish the other thing? [end p34]
It is perfectly reasonable to say, and this is the direction in which we are trying to influence things, that there are regions of the Community which have, because they are differently geographically situated, because they have a different tradition, which can have a different method of control of immigrants and possibly control of goods and services.
We have not got a land frontier except with Ireland. What they do at their land frontiers is for them to say.
Sir David English and Gordon Greig,Daily Mail
(Inaudible).
Prime Minister
Yes, all right, but because we are all surrounded by water, what they do at land frontiers is their business, I do not want to interfere with what they do. But equally I do not think, so long as we all have some particular control on immigration, control on terrorists, criminals and drugs, it does not mean that we have to have the same control when our geographical situation, surrounded by water, is different.
So what I am saying, therefore, is so long as we each have our own method of control, we can do exactly what we have done over qualifications - we have our method of control and they have theirs. [end p35]
Prime Minister
But we do honour to this, to the Declaration, in making certain that we have a control. But our attitude is that we are not stopping them from having their compulsory identity cards if they want to, that is for them to decide.
Sir David English and Gordon Greig,Daily Mail
(Inaudible).
Prime Minister
No they are not.
Sir David English and Gordon Greig,Daily Mail
I must get this clear because it is a very important issue. You are saying that I can get on a plane in Rome and fly to Frankfurt or Paris and Copenhagen and I can just walk out without going into any controls, but if I fly from any of those airports to [illegible word] I shall have go through a control, is that what you are saying?
Prime Minister
No, what I am saying is that it is in the interests of all countries that you should not have unlimited immigration from outside Europe into Europe occurring because we drop controls on Europeans going round Europe and therefore we must each have a system to see that that does not happen, not only for ourselves, but in justice [end p36] to other countries in Europe so that they do not get illegal immigrants coming in.
Sir David English and Gordon Greig,Daily Mail
… they can have open airports and open frontiers but we will not, that is basically it?
Prime Minister
I do not think they will have open airports. What I am saying is we are not stopping you from doing your own system, but we must all have an effective system. It may not be the same system because our traditions are different but it must be an effective system. That is what I am suggesting we get down to.
Sir David English and Gordon Greig,Daily Mail
I do not think that argument is going to be unpopular with the British public, I agree with you, I do not think it will be unpopular at all, but it may well, you know because of the complexity of this, lead itself to trouble with Europe might it not because the Article actually talks about the free movement of people and the bringing down of frontiers. There then will be the interpretation of that Declaration that you read, but that may have to go to the Court to be decided may it not? [end p37]
Prime Minister
No, the difficulty is a Declaration is not a law, but when we passed the Law we all agreed that this had to be dealt with and we made a Declaration to that effect.
All I am suggesting now is that we get down and clothe that Declaration, made in good faith, with practical proposals. What I am also suggesting is that those practical proposals do not have to be the same in each country because of the different position of each country and because of the different methods which they have.
Sir David English and Gordon Greig,Daily Mail
But if you found a practical proposal that was satisfactory to you and the Government, that did not include the closing of the frontiers, then you would accepts that, is that right?
Prime Minister
Well yes, I am saying we are not interfering in any way with what you want to do across your land borders. But we are different. We have one land border and as you know we do have very considerable problems with that border.
Sir David English and Gordon Greig,Daily Mail
And so we would argue on the Declaration and try to come to a compromise on that? [end p38]
Prime Minister
We argue from the Declaration and we argue by analogy with what they have done for qualifications and certain other things on standards, some standards, that because we cannot get one single standard we accept the standards of each country in any country in the Community. You argue from that to dealing with that in your immigration and drug cases, that each of you has to have an effective system of detecting them. It may be different.
But that is an example really of getting on with the practical things which happen to be very very important.
Sir David English and Gordon Greig,Daily Mail
There is a European criticism that Mr Hurd is not getting on with it and that in fact he should be getting on with it.
Prime Minister
But Douglas HurdDouglas is getting on with it. We are trying to get on with this. We raise it at the European Council, I think Mr Lubbers and I have raised it at every European Council. But the proposals have not yet come forward.
Really what I am saying, David EnglishDavid, is that there are these really big things to be tackled which I think would be much better if we got on with rather than the smaller things, but we are actually ahead on some of the other things. [end p39]
For example, France has been saying, although I hope she will give it up soon, that she simply cannot in fact have free movement of capital unless everyone has the same level of tax, of withholding tax, as she does.
Well we have become free, you are not going to be told that you now have to have a tax imposed upon you from outside. Actually we can do it.
Sir David English and Gordon Greig,Daily Mail
But we have withholding tax do we not?
Prime Minister
Not on external people. The interesting thing is Germany introduced a withholding tax, capital went out of Germany of course as we always said it would and she has canceled it.
Sir David English and Gordon Greig,Daily Mail
(Inaudible) [end p40]
Prime Minister
But David, what you are saying is, you are agreeing with me.
Sir David English and Gordon Greig,Daily Mail
But I do agree with you, what gives you the impression that I do not?
Prime Minister
But then David you say that because I put these arguments forcibly, and win, that I am anti-European. It is a different vision of Europe. [end p41]
Sir David English and Gordon Greig,Daily Mail
No I did not say that, I said this was the difficulty of putting these arguments over to the public because when you put them over forcefully the net result can be an anti-European feeling in the public. Because you have to give, what all these people are doing what you think is wrong, and you are persuasive and people think “Well, they are a bunch of swine over there, why should we have too much to do with them?”
That is the difficulty of the argument, I am not saying that you are anti-European.
Prime Minister
I am not. I am from a much wider, deeper, fundamental vision.
Sir David English and Gordon Greig,Daily Mail
I am saying this is the difficulty of the argument.
Prime Minister
No, it is not the difficulty of the argument, it is partly the difference of our Parliamentary system. I do not know of any other Prime Minister who, after the European Council, or Head of Government or State, I do not know of any, not a single one, that has to go back to his Parliament, make a statement, and stand and be cross-examined on that statement for nearly an hour. They do not do it. [end p42]
Sir David English and Gordon Greig,Daily Mail
Well, that is our system, we have been brought up to expect that.
Prime Minister
Yes, but do you not see that when I am in Europe I know that I am going to be cross-examined, I know that I have to justify to the only Parliament to which I am accountable, every single thing I have done. Of course I do.
Sir David English and Gordon Greig,Daily Mail
Are you saying that the others are not accountable?
Prime Minister
They are not accountable in the same way. Let me give you an example, when I went to Madrid we had a very successful visit to Madrid, I went to their Parliament. I saw all eleven leaders of the opposition, because it is fragmented, around a big long table, I spent about two and a half hours with them, each of them talking to one another, each of them giving their different view, each of them asking me three questions. At the end the last one said: “Thank you very much for coming Mrs Thatcher, it is not often that we have the chance to question a Prime Minister, it is a rare treat for us”. [end p43]
I did not know this. I said: “But doesn't your Felipe GonzalezPrime Minister come to Parliament?” No, it is not their custom. He will go about three times a year and make a statement, I said: “Well, will he not be cross-examined on it?” “No.”
Now of course, do you not think that part of the combative questioning that I have to face gives the impression of a fight? There is not a single one, possibly Mr Schluter, possibly Denmark, because they also very much … He does not have to take questions, their Prime Ministers are too grand to take questions, we are right in the nitty gritty, in the thick and heat of it, so of course I have to go.
Sir David English and Gordon Greig,Daily Mail
That is probably why the press both here and in Europe is saying that you are anti-European, though you may not well be and you can be very persuasive that you are not. But nevertheless they are saying that and now some members of your own Party are saying that.
Prime Minister
Please can I ask you how can you be authoritarian when you are actually arguing for fewer regulations? That is your problem because you have set up a totally false thing. [end p44]
I argue for greater liberty within a basic framework of general law and for the limitation of the powers of government so that the people may have the greater expression of their talents and abilities. I have reduced tax, I have reduced the number of industries under government control, we have got rid of a lot of controls, how in the world can anyone who is honest say that by reducing controls, by redressing the balance of power in favour of the citizen, against the state, is authoritarian, when in fact it is the very reverse, it is enlarging the liberty of the subject and my whole thing has been that this country has become more prosperous because we have done just that.
Now how can you, in all honesty, call it authoritarian?
Sir David English and Gordon Greig,Daily Mail
I am not, we are saying other people are.
Prime Minister
Well, you stand up for my viewpoint.
Sir David English and Gordon Greig,Daily Mail
I do stand up for your viewpoint and I definitely stand up for your viewpoint that we want less control from Europe, I certainly do not disagree with that, although as I said, we all know we have actually given some of it away. [end p45]
Prime Minister
Exactly, we have to have common standards and when we went in we agreed that all trading negotiations be conducted through Europe, that does not mean we have no say, it means that we get in there fighting to keep open trade the world over and to have free and fair trade, but it must be fair. So we are in there fighting and we need the Commission to fight fairly.
Let me give you another example, mergers, you must take account of the different habit and customs of different people on mergers. Now you know, because you will be the first to say it, and it is not difficult for other countries to start to buy in our companies because of the way our shares are held and we go to the Monopolies and Mergers Commission.
But in some countries there is practically no way in which you could, on the same basis, buy into their companies because many of the shares are held by banks so they have a freedom to buy into ours that we do not to buy into theirs.
So what am I doing? I am saying: “Look, these are different and if you are going to have a control from Europe which does not take into account these differences, what you are going to get is something that is thoroughly unfair.” Now I want a fair one.
Sir David English and Gordon Greig,Daily Mail
So we are quite happy to use the Commission to get that sense of fairness from our point of view? [end p46]
Prime Minister
To get fairness, yes of course, and I do use it and I must say they are very good. It was the Commission that stood by us in the Nissan case. It will be the Commission that stands by us in the Renault case. It takes a long time.
But David EnglishDavid I would not get it unless I went in to fight. Now the Commission have done a Water Directive. We are getting up to it as fast as we possibly can because when we came there was practically nothing done about dirty beaches and so on. In 1975 the Commission had done their first Directive. By 1979 the beaches had not even been identified in this country and it was we who had to take it up vigorously.
The Water Directive they have chosen to do on drinking water goes further than safety. All our drinking water is safe, it goes further than safety, it goes to appearance, etc. They have chosen to take a Directive, which I think we have pretty nearly all agreed to, higher than the standard across Europe, and they have threatened eight countries with proceedings in the European Court.
We have all said, well now look, just tell us how in the world can you spend the capital on it and get it up, you are up to health standards, in a short time, you must be practical about it. So there are eight of us whom they have threatened.
Sir David English and Gordon Greig,Daily Mail
(Inaudible). [end p47]
Prime Minister
Yes, you must be practical. But let me say to you that we have spent more capital on water in our period than was ever spent in the last Labour period, and they have not helped us. And when we have you spend more capital you have got to have a little bit of increase in price, because you know the average cost of water in this country is very low. Is it that we spend 15p per day on drinking water?
So all right we agreed to that and we are all getting up to it as fast we possibly can.
Sir David English and Gordon Greig,Daily Mail
We are going to have to go a bit faster unless the amendment is overturned are we not?
Prime Minister
We are going to have to look at it to see if we can because let me say that drinking water is only about one percent of the water, you see. Now the question is do you have to have 99 percent with these great things just to get one percent? People do not think about these things.
It happens in only certain parts of the country but this year we are spending £1.4 billion, which actually is as much as we can do. It is not only the amount of money, it is the state of your construction industry, they have got as much as they can possibly do at the moment, pile on more and all you will find is that the price goes up and you will get no more done. [end p48]
Prime Minister
So we are having a look at it.
Sir David English and Gordon Greig,Daily Mail
… it will bring prices down, will it not?
Prime Minister
There are two things, it will put the price up to do more, but you do not want to put the price up doubly because your construction industry has got so much to do that it cannot take necessarily the extra so it quotes a much bigger tender. You would not have built your place that way.
Sir David English and Gordon Greig,Daily Mail
One further smaller thing - the bus passes and the language programme - that seems to me, I understand the principle that we are not going to be told by Europe to do these things, we will do them ourselves and so on and so forth, but can you win that on a PR battle?
Prime Minister
Yes we can.
Sir David English and Gordon Greig,Daily Mail
How? [end p49]
Prime Minister
That will have cost something like £160 million, Lingua, we can get very much better value for money by doing it the way we are going, with our curriculum.
Sir David English and Gordon Greig,Daily Mail
We do not have a very good reputation for teaching languages.
Prime Minister
We can get very much better value for money rather than set up another bureaucracy in Europe to do it. Now this is one of the problems. Some of the Committee are getting a new competence so you are having a double competence in these areas, not a framework of law within which we can operate, but a double competence.
Sir David English and Gordon Greig,Daily Mail
And bus passes?
Prime Minister
No, I do not think you should have bus passes. Look if you are not careful, David EnglishDavid, can I put this to you? If you are going to use Europe to say that every single thing which any country has, every country must have, so that every country must have free bus passes for its elderly, whether or not it has it, every country [end p50] must have the highest child benefit, every country must have the best National Health Service, which we think is ours, every country must have the same pensions, every country must have the same redundancy benefits, every country must have the same sickness, disabled mobility benefits to the highest, regardless of the productive capacity of the country, what you are going to get is such enormous costs put upon your industry that no-one in Europe, but no-one, will be able to compete with any overseas country, with the Japanese, with the South Koreans, with the Americans, with any overseas country, and they are going to have to put up the biggest protectionist barriers, and my nightmare will be realised.
Sir David English and Gordon Greig,Daily Mail
Does that go for the package of workers' rights?
Prime Minister
You have got in fact, this is why you have got, what affects employers and employees, you have got under the majority rule. We believe, when you start to talk about worker participation, I say to them: “Yes, we are talking about participation in shares. We think your attitude of putting people on because they are a trade unionist goes back to a Marxist period, a class struggle period. We are beyond that. We are every earner an owner.” [end p51]
Sir David English and Gordon Greig,Daily Mail
What happens if they vote, as they did on the cigarettes, would we go to the court on that one?
Prime Minister
I think that would come under unanimous. You see we have a social charter.
Sir David English and Gordon Greig,Daily Mail
It is not quite clear which one it comes under is it, that is the problem?
Prime Minister
No, we are not quite clear. But what I am absolutely clear is I do not stop them from doing what suits them. I remember the first Conference I attended. One of the Heads of Government who had just dropped, a small country, their hours of work to below what the rest of us in Europe had, he knew it would make them uncompetitive so he was desperately anxious that the rest of Europe would say that we shall only have the particular working week that he agreed, of course he was.
Sir David English and Gordon Greig,Daily Mail
You are absolutely right about that because this is where the southern … in America were able to take all the industry from the North … [end p52]
Prime Minister
Exactly, exactly. When I was President of Europe I had all the trade unions here and the German one said: “We want you to drop your standard working week”. I said: “No I am not imposing that on our people, we have to stay competitive, you are trying to impose that on us because you know full well that you have imposed it and you want other people to take that stand.”
We have to stay, Davied, we have to stay competitive in a world market place and if you are going to say that what anyone has everyone shall have, you will make Europe the most uncompetitive place in world markets and the vision of others will prevail that you put up a protectionist barrier around Europe and you do not carry out your duty to the world community.
Yes we do have still a Commonwealth of nations. Yes we are still close to many Third World countries, and so if you go that route you will destroy a Europe which trades with the rest of the world. You will put many people out of business, many people out of business.
Sir David English and Gordon Greig,Daily Mail
There is a danger there and I absolutely see the danger. Clearly we did not see it when we were dealing with these negotiations otherwise we would not have put ourselves in this ambivalent position. [end p53]
Prime Minister
I am sorry but we are not in an ambivalent position, we are not in an ambivalent position.
Sir David English and Gordon Greig,Daily Mail
Well, you said we may have to go to the court to decide who is right on that.
Prime Minister
Yes we may, because we think that that is under a unanimity rule and if it is not we should still have the Luxembourg Compromise. But I say to you that the argument should obtain with most other countries that if they go to maximising their costs by regulation and imposition on their industrialists they will create unemployment.
Now that is not what I joined Europe for and I believe it is not …
Sir David English and Gordon Greig,Daily Mail
So you are really trying to persuade them not to go this route themselves?
Prime Minister
That is right and it is not what they joined Europe for either and most of them will know the common sense of what I say. [end p54]
Now Germany has a different union structure from we do, her system is bound to her structure, so does Luxembourg, it is a small country and has a different one, we are not imposing anything, let them work the best way for them. But you simply cannot say …
Sir David English and Gordon Greig,Daily Mail
But you are still trying to persuade these other countries.
Prime Minister
Yes of course. But what you have got at the moment, the Council of Europe has a Social Charter, quite a good one, it is a voluntary Charter and quite good. But I do not attempt to impose on them worker shares.
Sir David English and Gordon Greig,Daily Mail
Persuade them but not impose.
Prime Minister
Encourage them yes. But also, my passion, David, is for meritocracy, I do not care what your background is, I do not believe in class struggle, I do not care a hoot where you come from or who your father is. I believe you get on according to your own ability and that is how I judge you and we did not go into Europe to have a class struggle imposed upon us. [end p55]
Sir David English and Gordon Greig,Daily Mail
Can I ask one last question and this is very important?
Prime Minister
Just a second, can I say to you, they talk about social partners and I say: “What is a social partner, do you deal with a trade unionist different because he is a trade unionist, why is he not a colleague?”
Your loyalty is to your company. It is your company that is efficient.
Sir David English and Gordon Greig,Daily Mail
We understand that. I have to ask you very quickly …
Prime Minister
You would not have got your … joy [sic] efficiency without the attitude that we have taken, and I believe that we can prevail in Europe.
Sir David English and Gordon Greig,Daily Mail
With our attitude …
Prime Minister
That is right, that is right, for enterprise, Europe on merit that can compete with the rest of the world on trade. [end p56]
Sir David English and Gordon Greig,Daily Mail
But one currency, and this is the big issue, now it is said you are exaggerating the whole threat of a United States of Europe. There is no possibility of it, we know there is no possibility of it because you can veto it under the unanimity thing, well it would have to require an amendment to the actual Treaty in fact to have one currency. So you can stop that any time. Why are we bringing that up as a great spectre, there is not risk of it if you did not want it?
Prime Minister
I did not bring it up, I did not bring it up.
Sir David English and Gordon Greig,Daily Mail
No they are bringing it up, but it is not a risk to us, is it?
Prime Minister
The Delors Report brought it up.
Sir David English and Gordon Greig,Daily Mail
But they cannot get it through unless we agree to it.
Prime Minister
No, but I think it is unwise to tackle things that way, as I have indicated to you. [end p57]
We have gone further faster on many things which are essential to a Common Market in Europe than some of them have. You go further faster on things because you genuinely believe it is in the interests of your people to work together.
Now you try to force things and you will not get a good result, you will not get it. We are genuinely working, and as I have indicated, are further faster than many of them. Some of them are, as I have indicated &dubellip;
Sir David English and Gordon Greig,Daily Mail
Even if that is just a blueprint, if of course in another twenty-five years the business of Europe needed it, then that would be a different matter would it?
Prime Minister
I do not know how Europe will grow but if you are going to have things forced on you, you cannot have, which are totally …
Sir David English and Gordon Greig,Daily Mail
This is the point which is being said, that they cannot be forced upon you.
Prime Minister
Well some of them can be under majority voting, but if you go absolutely flatly contrary to the history of a country, its [end p58] traditions, to the way it has developed, you will get into trouble. You could not do that in the United States because they all grew together. But even so they wisely accept enormous differences between the different states because they grew up together.
Sir David English and Gordon Greig,Daily Mail
Of course they do.
Prime Minister
Of course they do, but they have got a much better combination than some people I think in Europe because some I think are becoming so much Euromania that they will accept anything without looking at it to see.
Sir David English and Gordon Greig,Daily Mail
… are not Eurmanians [sic] then?
Prime Minister
No I am not going to, I am not going to, without in fact looking at whether it is good not only for their own country but good for Europe too. But let me tell you, some of those people who give that impression, when it comes to responding to their constituents, they will be the first to look after industry in their constituency and this has been my cry all along, stop talking in generalities because you give a wrong impression. [end p59]
You are going to react just as I do to the people to whom you are accountable but there are certain things that it is best for us all to do together, for those things we argue to our people, that it is better in the long-run we do them together.
Let me give you an example. It was we who put up the Political Cooperation Treaty, it was our idea, we drafted it. Remember the row we had when someone else put it down, having shown it to them, put it down in their name, remember the row we had at Milan, you remember? We drafted it, it was very good because on Falklands the whole of Europe stood by us. It is very good because on Salman Rushdie the whole of Europe stood by us for a short time and we stand by them because we stand together because we are more powerful together. It was our idea, David.
But I proceed by argument, by reason. I do not proceed, for example, European monetary union and economic union, how do you interpret it? I interpret it as a charter of liberty, for economic liberty, which was what the founders of Europe were about, then it was anxiety to have the economic sub-structure, foundation, to support the political liberty.
I interpret it, together with the word convergence, right inside the Treaty, that gradually you will pursue the same monetary policies, because there is only one sound monetary policy, that is that your production and your money supply are roughly in balance and if you put more money in than your production then you tend to get inflation and it takes a time to get it down. [end p60]
And so that you will go that way, as the world is going that way, on the basis of wisdom, and you will get convergence in your monetary policy, you will get convergence in your economic policy because they are sound ways to go.
The world is knowing, if I might say, that it is the Adam Smith, kind of Thatcherite, kind of United States enterprise policies, within a framework of reasonable law that encourages the talents and abilities of people that creates the wealth.
You will go that way because everyone, the number of people who have streamed through this room and saying: “We are following your policies Mrs Thatcher, we have tried everything else and it does not work”.
So they will go that way, they will get convergence that way, so we shall come to it naturally, more closely, by willingly working together.
Sir David English and Gordon Greig,Daily Mail
A common currency, not just monetary union?
Prime Minister
I do not know, I do not know, I can only tell you that I think there will be colossal resistance to getting rid of the pound sterling. [end p61]
But you cannot force, some of you say, I am accused of being authoritarian, I am the last to be authoritarian, I am not the one who is trying to force, I am the one who is trying to say we try to cooperate and I have cut through.
Sir David English and Gordon Greig,Daily Mail
(Inaudible)
Prime Minister
They are trying to force, I resist it, you do not get, there are some things you have to make rules about, of course you do, you have to have a strong rule of law, you have to have a strong defence, you have to have strong and fair rules, you have to have rules so that the weak are protected against the strong. You have to have rules for health and safety, of course you do, you have to have rules so that, in this country, we have a different social security system, we have a centralised income support system, they do not.
It is different, we go about it differently, but I am trying not to force it, I am trying to do it by cooperation.
Sir David English and Gordon Greig,Daily Mail
What about EMS, do you think we will be in by 1992? [end p62]
Prime Minister
The policy is that we shall join when we think the time is right. Hitherto we have been an oil currency, I do not know how much that still will be. Right now I think everyone agrees, and why they are quarrelling about other things I do not know. Right now every single person I meet agrees that our task is to get inflation down.
Sir David English and Gordon Greig,Daily Mail
I would have thought that joining the EMS would be one way to do it.
Prime Minister
Let me point out, inflation came up when we tried in fact to keep sterling at the deutschmark level. We could not do it because different things obtain in this country and at the moment you have far bigger dealings on our exchanges with sterling than you get across the foreign exchanges in Frankfurt which is a problem that we simply cannot ignore and do not forget, the main world trading currency goes in currencies not in the Exchange Rate Mechanism.
So you have got a rigid little bit and of course they do not like it when the dollar gets strong.
Sir David English and Gordon Greig,Daily Mail
Do you think the time might be right before 1992? [end p63]
Prime Minister
I do not know, but I do know that at the moment our main thing is to get down inflation and of course, which we must look at, their main thing in the Exchange Rate Mechanism is to come up to the freedom which we now experience, which is now part of our daily life, without trying to impose other restrictions on people. That is the immediate thing.
Really David, you get far further faster if you go my way of being practical about it and not talking in lofty terms.
Sir David English and Gordon Greig,Daily Mail
Do you think the Europeans are too lofty and idealistic then?
Prime Minister
I think, as I have indicated, there are great big things we have to decide. When they do these little regulations about things on cigarette packets and all sit down and say not only do we agree there be the health warning but we agree …
Sir David English and Gordon Greig,Daily Mail
That is petty is it not?
Prime Minister
You said it. [end p64]
Sir David English and Gordon Greig,Daily Mail
But I think it is rather petty to argue about it, as you have so rightly said.
Prime Minister
Yes, there are big things. We have got to deal about this thing about immigration, we have got to deal with drugs, we have got to deal with air fares. We had to deal with the surplus mountains, we have to deal with the fraud, we raised it, we have not yet succeeded in some of these things.
But the things we are doing have been of more benefit to the consumers of Europe, have been of more benefit to the future of Europe, have kept Europe looking out in our tradition we are outward-looking country into the wider world and we will have European trade very much better able to compete.
Sir David English and Gordon Greig,Daily Mail
And you will certainly use your power to stop them going the wrong way, you would not be afraid to do so?
Prime Minister
Yes, I would because it would be short-term.
Sir David English and Gordon Greig,Daily Mail
And that would be for Europe, not for Britain, you would be doing that for Europe and not for Britain? [end p65]
Prime Minister
Yes. It was this Europe that gave freedom, democracy under a rule of law, that science turned to the benefit of peoples, to the wider world and we are not going to live below those great things which Europe did.
It was European values which were taken to the United States. Now we are not going the reverse way from those fundamental values.
Sir David English and Gordon Greig,Daily Mail
Do you think that the so-called distress and divisions in the Party are right or not? Do you think people are divided because they do not understand or because they have missed the viewpoint?
Prime Minister
(Inaudible).