In Part 1, I described the Werner Plan for economic and monetary union in the EEC, and the assessment by British officials of the Plan, and in particular of the implications for national sovereignty, if it were to be adopted by the Six. They foresaw ‘the renunciation of national sovereignties in the economic field’ (Strategic Review, 23 October 1970); ‘the ultimate creation of a European federal state with a single currency’, ‘the surrender of national prerogatives’, that ‘economic sovereignty would to all intents and purposes disappear at the national level’, and that the independence of the member States would arguably be less than that of the States of the USA (FCO 30/789, 9 November 1970). How is it then, that in the White Paper of July 1971, recommending Britain’s accession to the EEC, the British government felt able to claim that this would not involve ‘any erosion of essential national sovereignty’? My case here is that this was a big lie, although I think it is fair to add that, as we shall see, the text was written in such a way as to allow scope for arguments that this claim had been qualified in one or other of two respects. But both the arguments fail, in my opinion.
The facts hardly hidden
It is also fair to add that the facts of the matter were not hidden; it was only the assessment of those facts that was concealed. The Werner Plan was out in the open, and so, in broad terms, was the British government’s agreement to participate in it. At his Summit Meeting with President Pompidou on 20/21 May 1971, it is recorded in the Secret minutes that ‘the British Prime Minister fully supported the development of economic and monetary union, (or its co-ordination, or whatever had been the expression employed in the Hague Communiqué), and also supported the action required to bring this about.’ 1 In his report on the Summit to the House of Commons on 24 May 1971, Heath told the House that ‘I told President Pompidou that Britain looked forward wholeheartedly to joining in the economic and monetary development of the Community’, and that he ‘was able to dispel any reservations which the French Government might have felt about the British Government’s willingness, which my right hon. Friends the Chancellor of the Exchequer and the Chancellor of the Duchy of Lancaster have often expressed, to accept the consequences of this development for its own policies.’ 2
Even more explicitly, Heath told the House of Commons on 10 June 1971 that ‘We have said that as members of the enlarged Community we would play our full part in the progress towards economic and monetary union.’ 3 The previous day Rippon (Britain’s Chief Negotiator) had reaffirmed the willingness of the British Government, expressed as early as 1968 by Harold Wilson when he was Prime Minister, to go even so far as a single currency:
Our view is still the view expressed by the right hon. Gentleman the Leader of the Opposition when he spoke at Guildhall on 29th July last year. “Two years ago I made it clear that we were prepared to discuss—it was indeed in Luxembourg—to discuss and of course in a meaningful sense, progress in currency matters, not excluding as an ultimate aim a common European currency.” That may be very far in the future, but all these matters will be discussed after accession in the context of what progress we are able to make towards economic and monetary union. 4
Again on 10 June 1971, Heath told the House that ‘what we are considering is the co-ordination of currencies. The Community has not got to the point of considering a common currency’, which of course implies that such a development may be expected in the future. In the very next breath he stated that ‘The Werner Report has been published’, but made no further comment upon it. 5
July White Paper
Agreement on the critical issues in the negotiations was reached on 23 June 1971, and on 1 July the Cabinet formally agreed to recommend Britain’s entry to the Community on the basis of the government’s draft White Paper. The White Paper itself was published on 7 July and it is to this that we now turn.
With regard to the Community’s plan for economic and monetary union, the White Paper states, remarkably:
No firm timetable has yet been agreed for this in the longer term; the immediate steps agreed so far will not involve practical difficulties for us. If we were not to join, this would not stop the Community of Six moving forward in both the economic and political fields. Thus the options open to future British governments would be limited without their having any say in the matter. 6
Very blatantly, the paper avoids any assessment of the implications for the UK for the ‘longer term’ aspects of the plan. It simply says first, that the short term aspects are not problematic, and second, that there is no firm timetable for the longer term. The question surely left begging, therefore, is what difficulties the longer term might hold for us. But this is not answered. Instead, refuge is taken in some unstated consequences of not joining in with the programme. Then follows the paragraph on sovereignty which, in my opinion, contains the big lie:
… The Community is no federation of provinces or counties… On a question where a Government considers that vital national interests are involved, it is established that the decision should be unanimous. Like any other treaty the Treaty of Rome commits its signatories to support agreed aims; but the commitment represents the voluntary undertaking of a sovereign state to observe policies which it has helped to form. There is no question of any erosion of essential national sovereignty; what is proposed is a sharing and an enlargement of individual national sovereignties in the general interest.
Can the claim be justified?
The claim that there is ‘no question of any erosion of essential national sovereignty’ can be traced back to Heath’s May report to the House, referred to above, on his meeting with Pompidou, in which he claimed that joining the Community would not ‘entail … an erosion of essential national sovereignty’. 7 I can see two main ways in which this claim could be reconciled with the government’s internal assessment that, if the plan for economic and monetary union, agreed to by the Six on 22 March 1971, were to be implemented, then ‘economic sovereignty would to all intents and purposes disappear at the national level’. First, it could perhaps be argued that the reference in the White Paper is only to the existing situation, and not to a future one. But the expression ‘there is no question of’ must certainly include the foreseeable future, since that is what one would naturally be asking questions about. Similarly, it could be argued that the reference is only to loss of sovereignty under the Treaty of Rome. Monetary and economic union would involve treaty change, and on this we would have the right of veto, and be able to exercise our sovereignty in making a decision on whether to allow it. But as has been shown, the British government had already committed itself to cooperating with such a development, and so such a choice would not in fact exist. Moreover, the short version of the White Paper, of which the Government made 5 1/2 million copies, did not include the preceding reference to the Treaty of Rome. 8
Along the same general lines, it could be argued that the Luxembourg Compromise of 1966, to which reference is certainly being made in paragraph 29 of the White Paper, would preserve national sovereignty. Heath had reported to the House on 24 May that he and Pompidou were agreed that ‘the Council of Ministers should continue to be the forum in which important decisions are taken’, and that ‘decisions should in practice be taken by unanimous agreement when vital national interests of any one or more members are at stake.’ He thus seemed to be allying himself with the French position that, even where the Treaty of Rome stipulated majority decision-making, an individual nation could reserve a right of veto where it considered ‘very important interests’ to be at stake. 9 The short version of the White Paper seems to be relying on the Luxembourg Compromise to justify its denial of any loss of essential national sovereignty:
It may certainly be admitted that this was a real protection for the future, concerning circumstances as yet unforeseen, in which we might need and be able to exercise a national veto, even against the terms of the Treaty of Rome. But it was no protection against the Werner Plan for economic and monetary union, since Heath had already made a commitment to participate in that willingly.
Alternatively, and secondly, it might be argued that the denial of a loss of essential national sovereignty is qualified by an admission of a ‘sharing’ and an ‘enlargement’ of national sovereignties. But what is this ‘sharing’ or ‘enlargement’? Can ‘national sovereignty’ be shared with other nations? It seems to me that if sovereignty is pooled or shared among the member states, then it is no longer national sovereignty but collective sovereignty. The authority to rule is vested in the institutions of the Community on behalf of the peoples of the member nations, it could perhaps be said, to the extent that there is democratic oversight from the Council and the Parliament. But then the individual nations are no longer sovereign.
‘a plain lie’
On 24 July 1971, Andrew Alexander wrote as follows in the Daily Telegraph:
Then there is the White Paper, one passage in which states that membership of the Community would involve “no question of any erosion of essential national sovereignty.”
That is a plain lie: there is no other word for it. In fact a very good case can be made out for giving up some basic national sovereignty. But there is no justification whatever for deception. 10
The White Paper (§8) undertook to ‘seek the approval of Parliament in the autumn for a decision of principle to take up full membership of the Communities on the basis of the negotiations which have been negotiated with them.’ The debate in the House of Commons took place on six days between the 21 and 28 October 1971. On the first day of debate, Sir Gerald Nabarro took advantage of Alexander’s article to circumvent House customs concerning unparliamentary language:
The White Paper … addresses itself only very slightly—and tenuously at that—to the issue of national sovereignty. So much so that … Mr. Andrew Alexander, referring to the White Paper’s denial of loss of sovereignty, called it: A plain lie. There is no other word for it. That was on 24th July, 1971. I would not impute mendacity to any of my right hon. Friends, least of all my right hon. and learned Friend the Member for Hexham (Mr. Rippon). … But, by a sin of omission, the sovereignty issue was scantily dealt with in the White Paper. 11
‘a public deception’
Again, on 25 October, Mr John Sutcliffe MP pointed out the contradiction between the White Paper’s avowal that membership would involve ‘no question of any erosion of any national sovereignty’, and the government taking seriously the prospect of monetary union. ‘National currency’, he points out, ‘lies at the heart of national sovereignty, and a common currency, so far from being the father, is the child of political union.’ He went on to quote Professor Toynbee as saying that ‘It is just because we are really attacking the principle of local sovereignty that we keep on protesting our loyalty to it so loudly, all the time denying with our lips what we are doing with our hands’, and concluded ‘On such an issue can there be any justification for this confusion amounting to a public deception?’
Barbara Castle on the Werner Plan
Barbara Castle told the House on 27 October that, as a result of the exchange crisis of 1969:
the choice was made starkly clear: either the Community would go on to full economic and monetary union, or it would disintegrate into nothing more than a grouping of nationalist States. It was from that experience that we had the birth of the Werner plan, which, if implemented, would destroy the last remnants of this House’s sovereignty. It would take from the individual members of the Community all control over monetary policy, all control over their foreign exchange parities, all control over the shape or size of their own national budgets, all control over the level and nature of their taxes, all control over their regional and structural policies, and, as the Werner plan made clear, it would mean the transfer of these far-reaching decisions from the national level to the Community level. 12
Referring to Heath’s statement, quoted above, that ‘we would play our full part in the progress towards economic and monetary union’, she went on:
In the negotiations, as the Prime Minister made clear to the House on 10th June, the Government have pledged that Britain will play her full part in the progress towards this vast expansion of supra-nationalism. Those are words, but they are important words. The Government have made that pledge without putting before the country or this House any plans for securing democratic political control in Europe over this new Leviathan.
Jim Callaghan on the Werner Plan
On the last day of the debate, and in the closing speech for the Opposition, James Callaghan again drew attention to the Werner Plan, and its implications for national sovereignty. He refers (cc 2191, 2198), to Pompidou’s account of his summit meeting with Heath, the question he said Pompidou had put as to whether Britain would ‘play her part in the creation of a European monetary union’, and the affirmative answer he said he had received. He recalls that
When the Prime Minister of Luxembourg, Mr. Werner, put forward his plan for a monetary and economic union two years ago [sic – about one year since the final report] it would have required the surrender of independent decision in fiscal and monetary matters as well as in others—such important matters as determining the level of demand in each country deciding whether to accelerate growth or slow it down with the resulting effect on the level of unemployment in individual countries. That plan, which was quickly buried, at least had the advantage of bringing into the open for the first time the inherent conflict between what is called European-ism and national sovereignty. That is why it was buried so quickly by the Council of Ministers. Public opinion would not have stood for it.
… Such a union—and I think that the Government Front Bench will agree with me on this the Prime Minister said “Yes” to it, if M. Pompidou is to be believed—would require a large measure of sovereignty to be forfeited. The question arises, who is to control it? It is unthinkable, except in the closed world of Brussels or a group of central bankers, that such vital decisions should be left to a group of civil servants. The inevitable logic is that we must be driven to set up a federal Parliament. I can understand Ministers shying away from this. Public opinion in their countries would not tolerate it. 13
Although Callaghan refers to the Werner Plan as having been ‘buried’, he also points out that Heath had agreed to the implementation of such a plan, implying that the burial was not necessarily too deep for it to be brought back to the surface when the moment was right. Moments earlier in his speech, he had given reasons why it was doubtful whether such a union could ‘get off the ground’, but then said that nevertheless ‘We ought to consider … what would happen if it did’. His answer was that ‘a large measure of sovereignty would be forfeited.’
Callaghan went on to suggest a potential connection between monetary union and a federal Europe, and then challenged the Prime Minister to explain what kind of Europe he was aiming at:
Opinion in this House ranges from the right hon. Member for Streatham (Mr. Sandys)—who is ready to see a federal Europe—and the Leader of the Liberal Party—who is ready to see a full monetary union by 1980—to the great majority of hon. Members on both sides of the House who would not accept such a concept, whatever their views about entering Europe.
The pro-Marketeers justify their general position by saying that no more loss of sovereignty would be involved when we enter than when we sign any other international agreement … It is not so but, if it were, I simply do not understand how one builds a Community on the basis of individual vetoes.
Where does the Prime Minister stand on this matter? As he is asking us to agree to an economic and monetary union we ought to know where he is going, and where he wants us to go. What kind of Europe is he aiming at? 14
Heath did not answer the question but instead pointed out that Callaghan himself, when Chancellor of the Exchequer, had in September 1967 written an article for Le Monde in which he set out his own aspirations in the direction of monetary union. Catherine Schenk, in ‘The Decline of Sterling’, confirms that the article ‘confirmed that, “so far as the role of sterling is concerned, we are ready for change”, and suggested that there might be a common European currency in the future.’ 15 The political point was made, and Heath evaded having to address the contradiction between his support for monetary and political union, and his claim that entry to the EEC would not result in the loss of essential national sovereignty. This claim was, I continue to argue, a big lie.
Two other matters
It seems to me that if it is accepted that the British government employed deception to get us into the EEC, then the case for our now leaving the Community is strengthened. Brexit could then be seen as the reversal of an historic injustice. But it may be objected that in fact the plan for economic and monetary union did not go ahead in Heath’s time, and when it did under Delors, Britain did not fulfil its previous commitment to participate. Even if there was a degree of deception, there was little practical consequence since in the end we did not go down that route. Because of this potential objection, it is needful to point out that it was not only the plan for EMU that would result in the loss of national sovereignty. There were at least two other aspects of EEC membership which the government was fully aware of and committed to, and which would certainly result in such a loss. To these, the primacy of EU law, and the extension of EU competence, I turn in Part 3.
- Record of a Conversation between the Prime Minister and the President of the French Republic, 21 May 1971, 1600 hours, p.3 Link. ↩
- Hansard, Prime Minister and President Pompidou (Talks), HC Deb 24 May 1971 vol 818 c33. Link. ↩
- Hansard, European Economic Community, HC Deb 10 June 1971 vol 818 c1235. Link. ↩
- Hansard, European Economic Community, HC Deb 09 June 1971 vol 818 c1060. Link. ↩
- Hansard, European Economic Community, HC Deb 10 June 1971 vol 818 c1241. Link. ↩
- White Paper, The United Kingdom and the European Communities, Cmnd. 4715 (HMSO, July 1967) p. 8. Link. ↩
- Hansard, Prime Minister and President Pompidou (Talks), HC Deb 24 May 1971 vol 818 c33. Link. ↩
- Britain and Europe: A Short Version of the Government’s White Paper. Link 1. Link 2, video at 11.35. Link 3. ↩
- The Luxembourg Compromise (January 1966). Link. See note 4 for the wording. ↩
- Andrew Alexander, Where the debate has to be won, Daily Telegraph 24 July 1971. Link (no flash allowed in the Bodleian Mackerras Reading Room). ↩
- European Economic Community, HC Deb 21 October 1971 vol 823 c978. Link. ↩
- European Communities, HC Deb 27 October 1971 vol 823 c1842. Link. ↩
- European Communities, HC Deb 28 October 1971 vol 823 cc 2198-9. Link. ↩
- European Communities, HC Deb 28 October 1971 vol 823 c 2199. Link. ↩
- Catherine R. Schenk, The Decline of Sterling, (Cambridge University Press, 2010) p. 136. Her reference is ’25 September 1967, BE OV53/36′ ↩