Eurozone

Bernard Jenkin Excerpts

Monday 10th October 2011 Commons Chamber

[Mr Osborne]

I think that is called a trick question. The hon. Gentleman has been an absolutely consistent and principled opponent of the euro. When I first arrived in the House in 2001, he was making the argument then and he is still making it now, and I respect him for it. As I have said, however, “I told you so” is not an economic policy at the moment. He may well be right about the problems of combining the economies of different countries with totally different structural problems, competitiveness rates and so on, let alone fiscal policies. He is right about all that, but we have to deal with the world as it is, and at a time like this I do not think that advocating the break-up of the euro is in our national interest. We need to make the euro work. Monetary unions can be made to work, but that involves things like fiscal transfers. At last, I think, the eurozone is facing up to that.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

May I remind my right hon. Friend of what he said on 24 September, when he reminded the world that there were six weeks to save the euro? If we get to 5 November and this crisis is grinding interminably on, will it not be time to start advocating the advice of Lord Lawson, who advocates an orderly break-up of the euro in order to restore growth to European economies and limit the liabilities that are constantly building up the longer this crisis goes on?

[Mr Osborne]

My hon. Friend is right to remind us that the G20 summit in Cannes is the last of a string of international meetings that have involved the G7, ECOFIN, which the Treasury Secretary attended, the International Monetary Fund, G20 Finance Ministers later this week and the European Council next week. It all culminates in the G20 meeting of world leaders at Cannes. That really is the moment when the world needs to be in no doubt that there is a solution to the eurozone problems and that we have the firepower and strength in the banking system to deal with them. If we do not deal with them, the situation will go from bad to even worse. However, as I say, it would not be sensible to advocate to our European colleagues the break-up of the euro. That would greatly diminish what we had to say in these meetings, as it would not be seen as practical—[Interruption.] Well, I also think it would be wrong, as it is not in Britain’s national interest to see the euro break up.