CAB128-94_A1b — Page 55

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While the French Presidency might well carry forward work, on a Charter it would be valuable to repeat the presentation made in Madrid in other Member countries and to enlist the support of business organisations including the European CBI whose support for the United Kingdom approach had not been reported to the meeting by the Spanish Presidency.

The

HE PRIME MINISTER said that as with the Social Charter a amber of Member countries had adopted a wholly uncritical proach to the Delors Report, which was the second major bject for consideration at the Council. The United pgdom's approach had however commanded support from Denmark, the Netherlands, Luxembourg and, intermittently, Ireland. There was some evidence of underlying discontent with possible Franco-German pretensions to determine the outcome this debate. In the event agreement had been reached (only on the proposals related to stage one in the Delors Report which were concerned with completion of the Single Market and closer economic and monetary cooperation on the basis of the existing Treaty. President Mitterrand had sought to agreement to a commitment to an early inter-government conference (IGC) to take forward stages two and three,

three, But had been out-manoeuvered. underlying Treaty ligation which the Community had adopted was for a rogressive realisation of Economic and Monetary Union (EMU)

this context the prescriptions for stages two and th

the Delors Report was wholly unacceptable for reasons the United Kingdom had made clear from the outset. These related in particular to the absence of political accountability and the transfer of sovereignty implied by the proposals, which would be wholly unacceptable to the British Parliament. Instead of the commitment sought by the French,greement had been reached at the Council that there shou be further preparatory work. This was to be taken forward by the Economic and Financial Council and other competent institutions. This outcome would permit the development_of alternative approaches in which a major element might be closer cooperation undertaken on a voluntary basis? The need for such alternatives had been well brought ou an article in The Economist of 24 June. The opportunity had been taken at the meeting to set out in more detail the conditions that would need to be satisfied for the United Kingdom to join the Exchange Rate Mechanism (ERN)uding a reduction in United Kingdom inflation and the abortion of exchange controls by major Member countries. noteworthy that although Spain had recently joined it had a derogation in relation to the Liberalisation Directive.

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