............................................................................... ON THE RECORD NORMAN LAMONT INTERVIEW RECORDED FROM TRANSMISSION: BBC-1 DATE: 19.2.95 ............................................................................... JOHN HUMPHRYS: Well, Norman Lamont, you're obviously deeply worried about the depth of Britain's commitment to Europe and the way things are going, but you were in the government, you were in the Cabinet
for years and years and - thirteen years altogether while all these decisions were being made. Didn't you know what was going on? NORMAN LAMONT: Well, I fought very hard for the things I believed in and I can assure you for example, the Maastricth Treaty would have been very different if I hadn't fought to get my view expressed in that treaty. HUMPHRYS: Because you helped negotiate it. LAMONT: ......getting us an opt-out, and for example one very significant change I made was against the advice of the Prime Minister and Foreign Secretary, I refused to accept that membership of the Exchange Rate Mechanism ought to be a legal obligation on this country. If I had not deleted that by my own personal action from the treaty we would today be absolutely committed to rejoining it. My views have been the same all the way along. What has changed of course has been the intensification of the process of European integration. We have more and more initiatives coming from Europe and more and more ambitions that this should be harmonised, that should be harmonised. One of the things that I had to resist when I was Chancellor were very ambitious attempts to harmonise taxation throughout Europe, something that I was passionately opposed to and something that I think is quite unnecessary for a single market in Europe. HUMPHRYS: So are you saying that the opt-out for instance might not have happened if you hadn't argued for it? LAMONT: No, I think the Prime Minister wanted to have the opt-out as well, but there were very many variants of it. We don't want to get lost in too much technical detail, but as a result of my own opposition to a single currency there is no obligation on this country before stage three takes place under the Maastricht Treaty to do anything differently from how we would have wanted to do it. HUMPHRYS: But you were the Dutch boy sticking his hand in that dyke in the Cabinet during those years you're saying, when people like Mr Major for instance were actually much more enthusiastic and prepared to allow that dyke to crumble. LAMONT: I have always been opposed to a single European currency. I've never made any secret of that. I observed the government's policy which was that we should have a choice. My view now is the same as it's always been, but I say in addition the whole country and the party have had ample time to consider this issue and we should make up our mind now. HUMPHRYS: You agreed to Maastricht, opt-out included of course, but you agreed to Maastricht, a treaty which you now seem to find deeply flawed for all sorts of different reasons. Why did you allow
it to happen - why did you applaud Mr Major metaphorically when he came back from Maastricht? LAMONT: I don't find the Maastricht Treaty flawed, I haven't said that. What I find we should not accept is the idea of a single currency. The good thing about the Maastricht Treaty was that it allows us to choose ourselves whether we do or do not have a single currency. HUMPHRYS: You were Chancellor when we signed that agreement. You're deeply worried about the way Britain is going now. The implication is that in some way the whole process has been hijacked. LAMONT: No. I think what is happening is that the process of integration in Europe is intensifying. I was deeply shocked during the whole of the Maastricht negotiations. It was actually a revelation to me. I supported our membership of the European Community in 1972. I always thought we were joining an economic community. I listened ... HUMPHRYS: And that was all? LAMONT: I thought we were joining an economic community - we might have had a political reason for joining it but we were not in favour of a united states of Europe or a federal Europe. HUMPHRYS: Then you weren't listening to what Douglas Hurd was saying at the time. LAMONT: I listened very carefully to what Geoffrey Howe said, and I quoted in my speech at Oxford the other day, when he said, "The central concept that we're signing up to is an economic community", and as Solicitor-General he said, "That is why most of the Community Law that
has a direct effect on this country is economic". Now what has been changing is that the ambitions in Europe have got bigger and bigger. It was only a couple of years ago that President Delors said that he envisaged that in a few years' time seventy per cent of the laws that affected the economies of Europe would come from Brussels. Then we had the initiative to have a single European currency. We also have had quite separately from Maastricht a whole series of initiatives to harmonise taxation, not just VAT, not just excise duty, but company taxation as well, something that I resisted, because I believe that it is the government of this country that ought to determine what sort of taxes we have. HUMPHRYS: But if you listen to what senior cabinet ministers have been saying for a number of years, the last few years and during the years when you yourself were in power, it is: we are influencing the European debate in such a way that things in Europe are moving in our direction - in Britain's direction. We've heard that from Mr Hurd no end of times, we've heard it from Mr Heseltine, we've heard it from Mr Clarke. You don't accept that? LAMONT: No, I don't believe that that is the case. HUMPHRYS: So they're misleading us? LAMONT: I'm sure they believe what they're saying, but I actually believe that we are not winning the argument in Europe
and my experience at the time when we were negotiating the Maastricht Treaty, and it deeply shocked me at the time, was that other heads of government had a completely different view of what Europe was going to evolve into. I remember having a very frank private conversation with Monsieur Beregovoy who was then Finance Minister in France, subsequently became Prime Minister and he said to me quite openly and I don't - didn't other than admire Monsieur Beregovoy, but he said to me, "What I want to see is a united states of Europe". HUMPHRYS: Well then the British Government must have been very naive to have bought the sort of package that we have subsequently bought into, or at least you fear we are buying in to? LAMONT: Well we're not committed to moving along such a road and we have an opt out from the Social Chapter, we have an opt out, that is to say a choice over whether we go down the route of a single currency or not.... HUMPHRYS: But you think we've already moved too far down that road? LAMONT: I think that we have ceded more powers to Brussels than is actually necessary. The Chancellor the other night said in his speech: "judge everything on its merits, does it serve Britain's interests", I think that we have ceded sovereignty and by sovereignty I mean the power to decide for ourselves on a policy issue, I think there are a whole raft of things where we have gone too far. If you take the single market, I'm in favour of the single market, but the single market is being exploited by other European Governments in order to harmonise everything, they've tried to move into the health and safety area, the fact that we have an opt out from the Social Chapter hasn't actually been completely bomb proof because they have approached through the single market route to say well we must harmonise hours at work and employment legislation, in the area of taxation a Chancellor's freedom of action on indirect taxation is already very circumscribed by what we have conceded in Europe. HUMPHRYS: Mr. Clarke doesn't agree with that, Mr. Hurd wouldn't agree with that definition at all, I mean, they are..surely they are good solid men who are taking us in the right direction? LAMONT: Well Kenneth Clarke and I actually disagreed about this at the time, I remember I told him that I didn't intend to go along with the harmonisation of indirect taxes in Europe and.... HUMPHRYS: This didn't reach the ears of an unsuspected British public did it... LAMONT: But I am just explaining to you what has been going on, I feel that we have moved too far along the direction of harmonisation for the sake of harmonisation. It is being done in the name of a vision, something called a united Europe. It is not being done because it is necessary for free trade in Europe, which is a very good idea. HUMPHRYS: Right and if that is so, there can be only one interpretation of it and that is that we are being misled, either for reasons of naivete of for reasons of political expediency? LAMONT: Well I don't think we are being misled but I thin.... HUMPHRYS: Well you can't both be right, you can't be right and Mr. Clarke can't be right. LAMONT: I think it would be helpful to the general debate on Europe if people were more open about their objectives, federalism or the united states of Europe is a policy that doesn't dare to speak its name. There are politicians who believe that the sooner Westminster becomes a county council the better, now I think it would be better if people who believed that said so... HUMPHRYS: Who are these people? LAMONT: I am not going to name names... HUMPHRYS: Well I mean can I assume that Mr. Clarke is one of those people... LAMONT: I think that it would be better if people who wanted to argue that we need more political integration in Europe said so and then, that is a perfectly honourable and perfectly desirable aim for a Government to have, it's not one that I personally share, but I think there are people who have that view. HUMPHRYS: And can I take it that Mr. Clarke is one of those people in your view? LAMONT: I think you ought to put it to him, I don't know.... HUMPHRYS: But that's clearly in your mind. LAMONT: ...but I think there are people, I think that is the view, for example, of Sir Edward Heath, but I sharply and strongly disagree with it, it is a perfectly honourable objective, it is one that he has held all his life and has argued for. HUMPHRYS: So that if, for instance, Mr. Clarke or Mr. Hurd takes that view, you think they ought to get up there and say so notwithstanding what Mr. Major has said which is that they should all be silent
and stand in line as it were, stay in line? LAMONT: Well I think the Prime Minister has a very difficult situation to deal with because there are divisions over this issue throughout the country, there are friends divided from each other, there are families divided over this issue and I think all political parties are divided. It is the supreme political issue of our time and honourable people can take take different views, but there is no way that we are going to avoid a great debate in this country on it, because you can't for long take the line that whether Britain has the freedom to issue its currency is something that we will simply decide at a later date, at some point we've actually got to confront the arguments as an issue of principle. HUMPHRYS: Some would say that that's exactly what Mr. Clarke for instance, has done, I mean, he stood up then, he said I've looked at this issue, I have decided for myself - and this is the Government's view - at least one assumes this if it's the Chancellor speaking - that it isn't going to take sovereignty away from Britain, it is not a matter of sovereignty, this is a matter of economics. LAMONT: Well I think what the Chancellor said the other night was we are keeping our options open and he spelt out some of the advantages as he saw it that could come from a single currency. I think he was entitled to do that I don't criticise him... HUMPHRYS: But you think it was wrong of course? LAMONT: I actually disagree with him and I particularly disagree with a view that having a single currency will not affect, we keep using this word, sovereignty, will not affect this country politically. Some of my strongest reservations are on grounds of politics and the constitution and the Prime Minister himself the other day said that this was a constitutional issue. I don't see how you can say it isn't an important constitutional issue because the fact is that you are taking away from the Chancellor of the Exchequer and the Governor of the Bank Of England in this country the right to determine monetary policy and you were saying that is going to a European institution, that may be right, it may be wrong but by definition it is a constitutional issue and it isn't just me who holds this view, I happened just yesterday to be looking through Nigel Lawson's autobiography and he spelt out very strongly and very clearly that a single currency is a constitutional issue....I also object to it on economic grounds. HUMPHRYS: Given that, given that it is an issue of fundamental importance to Britain, you said yourself the most important it's possible to conceive of in terms of our sovereignty, our constitution, what is more important then, that or the unity of the Tory Party? LAMONT: Well I hope that we will unite and I think the only way that the Conservative Party can be truly united is actually to move more towards a cautious, spectical approach towards Europe. HUMPHRYS: But if it doesn't...if you are faced with this choice.... LAMONT: Let me just finish, I very much agreed with the speech the Prime Minister made the other night at the Conservative Way Forward dinner. I very much agreed with what he said in his Economist article that he wrote I think a year, eighteen months ago saying what we want is - not a federal Europe - but something more like a Europe of nation states, a confederal Europe, one where there isn't just harmonisation for harmonisation's sake, and where there is diversity and where we widen the community. HUMPHRYS: But if people like Kenneth Clarke try
to move in the opposite direction from that, you're saying effectively as I understand you, they should put up or get out? LAMONT: I hope that Kenneth Clarke is going to stay on as Chancellor, please don't misinterpret me in any way because I think he is doing a good job and I think he is the right man in that job, I do not personally agree with what he says about a single currency. HUMPHRYS: Norman Lamont, thank you very much indeed. ...oooOooo...