European Council

Kelvin Hopkins Excerpts

Monday 20th December 2010 Commons Chamber

[The Prime Minister]

To be fair to other countries in Europe, the conversation around the Council table is very much about the action that everyone is having to take. Britain has set quite a pace in setting out a five-year programme about how we are going to do this and what we have seen in Britain is market interest rates coming down since the election, whereas in other European countries they have sometimes gone up. What is required is some credible fiscal plans. Fiscal consolidation alone will not settle down the eurozone but that has to be a part of it.

[Kelvin Hopkins (Luton North) (Lab)]

It is clear that, despite everything the European Union has done, the euro is still in crisis—and that crisis will not end any time soon. Has the Prime Minister been aware of or involved in any private discussions about how the euro might be deconstructed in a controlled way?

[The Prime Minister]

We had a very good discussion at the dinner, which involved all EU members, not just eurozone members. As someone who has never supported Britain’s joining the euro and who has always had concerns that the currency area was not optimal—as I said in my statement, I would make the argument that with a single currency, a move towards a single fiscal policy was needed, but that was never done—I must say it is profoundly not in Britain’s interest to see the break-up of the eurozone. If that happened, there would be very bad consequences not just for eurozone countries, but for Britain. We should take a hard-headed, practical view and recognise that 44% of our exports go to eurozone countries. If that broke up, it would be bad for Britain. We should be making positive suggestions about what eurozone countries can do to make sure that they get the stability and growth that we all need. There is fiscal consolidation, active monetary policy, cleaning up bank balance sheets, getting ahead of the markets and showing that we want this to be a success. That is what needs to happen and, as I say, standing on the sidelines and saying, “Well, we told you this wasn’t a great idea” is not the right approach.