European Council

Lord McFall of Alcluith Excerpts

Monday 27th June 2011 Lords Chamber

[Lord Strathclyde]

My Lords, I cannot help my noble friend in his extremely up-to-date question about what the Chinese premier said today to the Prime Minister. The Chinese Government have indicated that they would be willing to support the eurozone, which is very much to be welcomed. The Chinese population has as much of an interest in long-term financial stability in Europe as we have. We very much welcome their interest. I do not wish to overspeculate but I am sure that their help will be extremely useful in stabilising the eurozone.

[Lord McFall of Alcluith]

My Lords, is there not a need for more honesty in public utterances? Through our membership of the IMF, we are already contributing to the Greece plan. If we are to have the financial stability and growth that the Prime Minister wants, we need to engage positively so that we stabilise Greece and ensure that contagion does not spread to Spain in particular. Is there not a case for us engaging with Germany and other countries that are designated as rich to ensure that the rich countries help the poor to restabilise the euro? We could all then look forward to increased growth and prosperity.

[Lord Strathclyde]

My Lords, of course we are engaging in stability and growth. One of the conclusions of the Council was to do many of the things that the United Kingdom has been practising for some time. They include the encouragement of free markets in goods and the single market in services—particularly the digital economy—and new rules and regulations for micro-enterprises, which I know the noble Lord will be most interested in. It is very difficult to see how countries of the eurozone will get themselves out of the state that they are in by continuing to borrow in ever increasing amounts and not tackling the fundamental problem that underlies their economies, which is that they are spending considerably more than they can afford and that the international markets are growing nervous and are increasingly unwilling to lend to them.