Richard North, 22/06/2020  

One of the long-standing canards of the Europhile "community" – if there is such a thing, as a coherent body – is the settled belief that, because "visionary Europeans" were open about their ambitions, we should not be surprised when they came to pass. Eurosceptics should not behave as if the integrationalist agenda was a "dark secret".

Applying that thinking, way back in the early 1970s, before the United Kingdom had joined the EEC, the "colleagues" were already thinking of launching Economic Monetary Union (EMU), having commissioned the Werner Report to that effect.

Heath was fully aware of the Werner Report and subscribed to its aims, but it was not helpful that its author conceded that, to achieve EMU would require a massive transfer of powers to the Community level from the national centres, and that would raise "a certain number of political problems". These problems were not lost on Whitehall. The Foreign Office (now the Foreign and Commonwealth Office or FCO) produced an urgent note for Heath, copied by the Treasury, pointing out that the plan had "revolutionary long-term implications, both economic and political".

It could imply the ultimate creation of a European federal state with a single currency. All the basic instruments of national economic management (fiscal, monetary, incomes and regional policies) would ultimately be handed over to the federal authorities, to be accomplished within a decade.

Monetary union, the FCO feared, could become a central point of negotiations over entry, since it would arouse strong feelings about sovereignty and provoke vigorous discussions of its implications for future policy. In some areas, such as taxation, Britain might find it hard to make more compromises than other countries.

Nevertheless, the FCO argued, "we see no real reason why UK interests should significantly suffer". Any problems, it added optimistically, "ought not to be incapable of agreed solutions within the community". But it had to be faced that EMU would lead to the UK and the other EEC countries becoming as…
… interlocked as those of the states of the US. Indeed it could be argued that the independence of the members would be less than that of the (US) states, for the latter have more autonomy over their budgets. The degree of freedom which would then be vested in national governments might indeed be somewhat less than the autonomy enjoyed by the constituent states of the US.
There would be relatively little surrender of national sovereignty in the economic field, though as the first stage (of EMU) progressed, sovereignty would pass steadily towards the centre. At the ultimate stage economic sovereignty would to all intents and purposes disappear at the national level and the Community would itself be the master of … economic policy.

Crucially, the FCO warned, "there must be no mistake about the final objective; the process of change is 'irreversible', and the implications, both economic and political, must be accepted from the outset". For Heath and his advisers privately to accept such a plan was one thing. But at a moment when the British people were being assured that the Common Market was little more than a trading arrangement, this could be political dynamite. Geoffrey Rippon hurried over to Luxembourg for a personal interview with Werner on 27 October.

He congratulated him on his report but, alarmed at how such a radical step might be received by the British public, asked that political and economic union be achieved through a "step by step approach". It was ‘natural for people to be afraid of change’ and "part of his problem in Britain was to reassure people that their fears were unjustified". The ploy worked well enough. It was sufficient for Heath, on 13 July 1972, to get his European Communities Act through Parliament by a majority of 17 – "Ayes" 301, "Noes" 284.

Heath, however, had not done. On 19 October 1972, just 3 months after the European Communities Act had passed in the Commons, he was leading a delegation to Paris for the first Summit Conference of the enlarged Community – the so-called Paris Summit (pictured, third from right). The Conference proceedings which extended past midnight into the night of 20-21 October emerged with a sixteen-point declaration and preamble.

In this, the Heads of State and Government (of which Heath was one) reaffirmed "the resolve of the Member States of the enlarged Community to move irrevocably to Economic and Monetary Union", taking the required decisions during 1973 to allow transition to the second stage of the EMU on 1 January 1974, with a view to its complete realisation by 31 December 1980 at the latest.

Additionally, they assigned themselves "the key objective of converting, before the end of this decade and in absolute conformity with the signed Treaties, all the relationships between Member States into a European Union".

Yet, to most people in the UK, they had joined a "Common Market" – a trading relationship with the Six, which is what they celebrated – those who did – when we formally joined on 1 January 1973. By February 1974, however, Heath was history, replaced by Labour prime minister Harold Wilson, who came into office (although barely into power) on the promise of a referendum, on the back of renegotiating the terms of entry.

One of the objectives of that renegotiation would be the rejection of European Economic and Monetary Union. The Labour Party believed, it said, "that the monetary problems of the European countries can be resolved only in a world-wide framework".

When it came to the renegotiations, though, nothing changed as far as the Community EMU ambitions went. In fact, at the latter stages of the negotiations, Wilson himself was in Paris for the first European Council, held on 9-10 December 1974.

There, much to his embarrassment, Wilson found himself party to a communiqué, which stated:
The Heads of Government, having noted that internal and international difficulties have prevented in 1973 and 1974 the accomplishment of expected progress on the road to EMU, affirm that in this field their will has not weakened and that their objective has not changed since the Paris Conference.
Back in London, he found himself having to defend himself from his Cabinet colleagues who suggested that the passage on EMU in the communiqué "appeared to commit the Government on a number of issues in terms which were incompatible with the February Election Manifesto and would weaken the credibility of the Government's approach to renegotiation".

But Wilson dismissed the charge, saying that, "it was fully clear" that no country regarded it "as anything other than an ideal but distant goal". The reference to EMU, he said, should be seen in the same light as the commitment to "general and complete disarmament' to which Governments were always ready to subscribe" – a sort of European "motherhood and apple pie".

The interesting thing is that Jim Callaghan, earlier in June, had come to the same conclusion, having delivered a lengthy memorandum to Cabinet on the renegotiations "and related European Economic Community questions".

Shining through this was his view that the march of political integration had come to a halt. In an attempt to reassure Cabinet colleagues that their manifesto commitment on EMU was being resolved, he told them that the agreement at the 1972 Paris summit to have "European Union" by 1980 "turns out on investigation to have been completely without content".

"European Union by 1980", he said, "is a slogan or a banner to which many Europeans attach great importance and which the German and other Governments need for internal political reasons to hold out to their people as a long-term aim".

From his discussions with the other Foreign Ministers, though, he had concluded that none of them (not even the Dutch who claimed to be the most 'federalist'), seriously expected the Community to change the present basis for its decision-making in the foreseeable future.

With that, he said, "When further discussions of 'European Union' take place I shall hold to the view that all important decisions should continue to be taken by unanimous consensus in the Council of Ministers and I believe the other member states will agree".

The final word went to Callaghan in March 1975, in his "stocktaking" on the renegotiation, when he ticked off the EMU "box", saying it was no longer an issue.

"There had", he wrote to his Cabinet colleagues, "been a major change in the attitude of other Member Governments to the practicability of achieving economic and monetary union (EMU) by 1980". The programme for advancing to EMU by stages, he said, "had been tacitly abandoned".

But, of course, when it comes to the "European Union", nothing is ever abandoned - merely delayed. And that is why, when it came to writing a book about the European Union, we called it The Great Deception. Mostly, it was self-deception.

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