Eurozone Agreement

Lord Pearson of Rannoch Excerpts

Tuesday 10th January 2012 Lords Chamber

[Lord Howell of Guildford]

One can trade many words on what occurred at the December Council, but certainly something was stopped: namely, the proposal that there should be a pan-EU, 27-member amendment to the Lisbon treaty. That was stopped by my right honourable friend when he found that the safeguards he sought would not be available and that new intrusions on, and discriminations against, open competition were to be put in place. No doubt what emerges in the future will be developed in a constructive way and, I am sure, will have the full support of my right honourable friends the Prime Minister, the Deputy Prime Minister and all members of the coalition Cabinet.

[Lord Pearson of Rannoch]

My Lords, do the Government agree that the Greek, Spanish, Portuguese and other people would not be suffering as they are if it were not for the misguided project of European integration, complete with its ruinous euro? Has not the time come for the eurozone to abandon the euro and for all its members to return to their national currencies in an orderly fashion, complete with their own exchange and interest rates? Is that not the only sensible way forward?

[Lord Howell of Guildford]

The frank and sensible answer given by much higher authorities than me to the question, “Has the time come?” is, “We do not know”. As far as the situation of the Club Med countries is concerned—this applies in particular to Greece, which is having great difficulties in its debt restructuring—we hope that they will achieve it but we do not know, and we are not at all sure whether the necessary measures are in place to meet that short-term need. The broader issue of the fiscal stability union is aimed at the longer-term attempt to make sure that the eurozone is not constantly vulnerable to future crises. However, in the short term, if I told the noble Lord that I knew exactly what would happen, he would not believe me—and he would be right.