Tugendhat, Christopher.

English

Archive of European Integration

,-Extract of a  speech  of Christopher  TUGENDHAT, Member  of the  Commission  of the  European  Communities responsible  for  the·'"Budg'et;  on  the "Role  of an  E.EC  Commissioner", given  to a  lunch  offered by-the Westminster  Junior Chamber  of  Commerc~, on  7th  October  1977  in London .--..-· ~~ld!L  ;~~~~~~~:;;,I~IIF;~6~~:i~i~{f;~  .. - ..  . ~~-~·  ~:1•d; , ~:k,;:;,.:;:,_~,\-}~-L·:·P~!ec~:;;partcic_i~~~ion 1%1--the·fnl~lic;battie_ of_-~~  ~~~·~j~It~i15~~{J~~~::  "t~~'-so~~~hing. f<l'·  ~f~n the n~w Com.! s  sio!i attaches _  · :•,·:~'i!;~~~';;;~~t·~~;;,·~~~ ~~ofi  ~~··; Take ·  f~r E!l<~le the vexed issue .J';:  1{ ..  ")!_, ·."'-:'  -;jf,._:..~.,,...  . ,"  ·,  '  .  '  - -- - ' t~--·{'!~~~}t;·~.;:~ ::;5; ..::;'_'::-of  the ··common ·Agricultural  Policy~  I  suspec~ that not t  :Jt!~-'"~;:1~~~..--~~~~~~:l::r~ ~;.  '.l;{  ~'"  ~  - ."  ,  - - ...  · r~;r:~~-:-::r:::/};:')', <milny· people aooreciate that much  .of 'the most telling  J  ;~  ... ~  ..  ,.,  .~a; ... :;  :  ;_fii  :~t-:;~._0:, ~  -·~  -f.  >  >"  •  I  ~  ~ ~~J_-··:·::~:~t:·,~_-:'"'~;:~-~~~->  .:.-~d certainly the  ..  best.~nformed  ·~··public critic'ism of ;  ' i~"4~~;~~;·;-~-~  -~ .. ~-~?-_''  . - ,_  '  ',..  ~  : '' ',  _-,·,  '- '  '--'  . kf'~~t~;f:<:;:::"~~-;-"':~~- -~ ~,  the)  pr~sent ~:or  king of the  CAP  ha~ been voiced not by the · ~{ ~t~4(~~-~~~:;·-.,~{i~;~,;>:c~ntty•s  ~p<>nents  -.'~t .by  the Commission itself. t;~~~~~~i~~i;t:,:  :,t~f?> '  '  :  '  '2  .  - .:  .  .  .·.  .. .  .  .  . ' ,. . f.  ~-.J:''ti '~~.~:9:>':;;;<  ;;,'L'~ :··.  _  ;<'-"·  'nle comnlissipQ iS ._of  COUrSe  whoJeheartedly COmmitted f~JiB  "~~f~~~:i~s~:;~n~i~~::;r:n~:e:i~1:: :::::y~:dony ·  · ~;:~6f~~:~~;  __  ~·, ·),··.- stability_of'  prt;~-.~l'i·~-a- W9rl~ -~~~~a~ene~ by a terrifying f~:::t;-;j~):Y:~~~~~>tf'-r··'·, population exp_lost~n_•  ... ~t-in  .its- present form. the CAP ,:  "',-'>:~;.s-l;:.t/~'-->.~:~_-:~~t:/5_.."'".. •  .;;:-:;,;.=·.~--'  .··  .. ·"-/  .  .._  .- ,  ..  _.  •'  •,  ·.-...~  - ~·:·  '  .  ' ,,t\~•:it?":.r::~:~,;:::;~}\i~';;~;::  is  ~undeniably  .di~figured by unsightly blemishes, in  _  .··· . particular by excessive anct costly surpluses ·and  by the ·too ext:ensi;e ~se of  ·.Mon~-ta.ry~ compensatory _Amounts.  And in .:its' effortS: to  ensu~~'  that·. th~se defects are remedied,·. ·-··  '  ~  .  .  .  ~.  .  - - .  .  .  !t - -.- .  :·  .  .  -the Commission ha_s·  not merely l"repared concrete pr<>posals  for r:eform;  . it has· also striven to  create the : .  :  ~  '  .  .  . ;~·:;,,>::;;;,}::'~':':-':;;.>"'  _  necessary degree of p'olitical ·will  ·w£~hin·the Agricultural '{)~;~:,~::~q~f!rr~::  ~- ~. ·.  Coti~cil.of~ Ministers•  by:, ~aking every opportunity  to.·· ... ,-.•  :,;  '~  .. ·-;-:;.  ~- .  -·=:-'' _  _,. _-:.-.~-- ""  _-;,.  ,:,:~  .  '··. ~.\,'. -.:-~lt![!~~~:c ~·i"~t!,r{:~i.\f,;···  ··· · ~ :··.  ~  ..  -~_  ... _~ \~;~;~...  ·,}· -cr~~e a  be-tter understanding, at the_ ·level of national _·  .  -···  -..  :_,_·- .  ;.'·  .  .  ....  ~- ~  - .  ·.  ·l,  .. ; politics, of exactly how surpluses arise, of how  serious they have now.become.  and of the_precise finaQ.cial consequences of failing to reduce  them. ./. - ..... ~ . 0. ~ -. ,:::>.-~"'-~;  ·. ;";;~.'--.·--~~-J_?}_~~~_iit.•···'.:_;:-_-~.  -_~e_:  ......  _:.~ __  · ._  ,_  th_~  ·  '$UCt:ess  .• :  ·In tliis,·yeart·a annual  ..  __  .,,.-,,~~·~  :~~ ~:.; " _  ·.:~ ,  -.  e '  - ·  '  '  :,  .  ·'  ··  .>:''''<;  :,• ·.  ,  oT~~  ;.  :  :,,  ,::;:,' ,  : /:. '  ' , , '.'; :·2'';:(:_:, ·  ::[;X:~•  i~ ~:t"t.~~  ·-.\:"'~,>c \!·  - ;:;:~: '"'  Faraa  · Price ·review tlla ·  Conmlrpi ty  '.a· .Fa~;M1n1a  te;is · f•i  t  ·- ::-~I-'1·-~::~~~~t  :;:~ ~~~Jt:~·J·r~.;··''::::rirLj~a:~e:·:ea:::f~~!:::::··  ••tin~:::;t~~.:·{!?~:,·•(  -~ .  .  .  ''  :::, '- .  . .  .  .  .  .  .  •·.  .  .  .  ~,~.~~  .... ·.  ·• aceesslon,  and  ~: fairfy· ~dest  ·fig\lre ~en.: it  _is.· ccimpared.:Wit:h· the rate  .  .  .  .·.  ...  .  ;  ··  ..  _..-. oJ:,->  inflation in the Community  as a  ~ole~- -.-- .. ·  -.·  -~  .  '  ...  - .  .  -_:-·-~  •  <,-.. '-··. •  .  ·•  •  '.  ·r  • .  ·~ "~  .!';J  ·  .•  ~ ..  ·;j, ••  ~- ···-"<_  .....  --~  ··• ~netheless.  ev~n_ :3. ~  is:  ·a  ·ft~re_ higher than ~e •  Cotmd.sst<.m  initt~ll;  :~~commended to' the ·.councif~_  ..  'And  in :...:.·. a  numbel;,  of  -speec~es: ti~d ar.ticlej  ::X  have  sugge'~te~  th~t  '  : ·:institutional  c;hang~~: -~;;~- .rie~es_s~ry:· in the_ way· ·d1~- coti~cil' · .  .  '  .  .  ~  - ·  ...  _  . .  mak~s  .de-cisions  i-q  order to enaure  the more  effective •' representation· of non. ·agricu_lturai interestis. :;,. ·in. particular· by  pers~stently  dra~ng attention ·tO  the- defects ·of .  th~ -__ ( · e,;isting decision makthg machinery~- I  S.ndJny  .colleagues-' .'  ~ ~ . - ..  ·_·.  ..  ~-~:.C~'  .-.  .  - .  ,~~·-... ..  Will foster-. the necessa;y. awareness· and &terinination among  .  - . ~·  .  '  .  .  - . . ; ·~_:":-~--~-~~~  .thos~ationai politicians With  whom  t_b.e  respons:lbi~ity ·--.-"">':  '  <"''  •  '<  ••  '·  ·.·  .  •  '·  ··'  •·  .  •• ".· .  .  ~-. '  for effecting a  changd· ultimat~ly .rests  •.  · ·.'- .·  :.  -"  .  ;.,  .  .  .  _ ..  , .It is vital th4t we  succeed in this object.ive sooner ·,·r '  -. rather than ·later.  Fdr the enlargement of the_  Community ·.  -t'. to include Greece,  Portugal and Spain wfll_greatly-add to the scale and complexity of the CAP.  In these _··circumstances  to continue· to make  the mistakes of  the past ._··would -be  to invite consequences. much  worse  than anything we  have  so-far exoerienced.  ./. .  .  .. ,  ·, .·-·  .. · .  :G., _, ..... · ._::"'-. :Anothe;/c'bon~~rh of the present Commission is to· - .  ·'".:, ..  -~  ' . fuller publ:tC."·appredlat~on of-. the case for an ~--.  "•  : Fund  ~Fas setup_in '1;973,: with funds-allocated: · - ·.  '. in the-f.irst instance,' for  a  four year period.  , .. -.  :'"' ~- ' Ine~ittfbly~t the initial sums ·committed were  small. ncrv-.r  .that the Fund .has had  titl!le  to prove its usefulness,  .. Commission is endeavouring to  convince  the Hember C;··st:ates  of. the advantages of not merely contirnifng,  but _  •.  __  of <Sigqificant::ly expanding it  • • ··,  - '{!;  ·- '  '  '  - _.;  ' . .  ) .. '  .. One  imp<:rrtant m_eri t  -.of  a  common ·approach to regional policy to whichwehave t::ied.to_ draw attention is that i.t makes it pos'sibie  to construct a  system of regional ·  ..  ·  -- '  ._  .. incentives """'hich ·does not ·entail mutually destructive competition between different Member  States as  they race . ·  to overtake each othe-r on  the subsidy escalator.· · It is true that hn increase in the Regional Fund  ··  · would place an extra financial  burden on  some  of  the richer Member States w"h.o,  as··a.t present,  would receive back in.·-... direct financial aid from  the Fund a  good  deal less than they~-would have  to pay  in..  But for all the Member  States -rich and  poor alike - there would  be other less direct but not less significant economic  benefits.  For all its Members,  the main economic  rationale of  the Community  is that it offer;;;  em  e  substantial, stable and  re~dily important  consc;;qz.!ences  ;;.  policy bringtne  nt:~W prosperity to Europe's more  bac1:  .. :srd regio7\::C  would  ~12-·  ~':o  enable  the service unon  e.n  even more  impres.:;:; ·",:  .. ;}·  - .....  ·: .·)  ..;-.. ,.-:j  .~>. ;  _; . .... .,,..;.  __  ... '"";_ -opt~\\!~!~-- 'j~~lt_~~~~4:·<t_J~;  ..  r~~-- ·~:~-:  '  i;  .  . -1:  ~ ..  ""'~·.,.,  . .,,  ~-.·.,..N·{_:_6.\-,~--~~  .•  ::;~:_<>_-~~J_::  ·- .,--,_  -'~~-;--·_:~  ·'  .  :  -~_,.~_,·  . 0\  . ; :  ·.·~  ...  , , . '  .  ,  .  .  '  .·.-·--- .  ~--~.-.-.:._;·i';:f·;''- ..  n'·.·  ••  ;···;,';.··  .  ...  .  .  ~_:: "?:c;0J; 'i  ":'~~ . .  ' ' : .  _·  .  .  .  .  .  .  ..  ·.  ~  -i~ l\:&rthermore,  the' 'c6s~ of  ·~\ eff_ective _!egtonal pol1cy'  ~:  -~;r~ ·L · need. not  be very great.  ·_  . The  MaCDo~gall'  Commit.tetfr...  a  Working·  t1~ .  - .  .  .  .  .~  :;  ~- .  .  .  •  '  ~:;J -~art~· sa~'- up under_  ~he 'auspices o(  the Comnis-siort - concluded  ~1~ '··'·  }~ that~,aJ'.~cka$e ·o~ prpposals whicp ;e estimat.es ~~oulci increase  ,;;li1 \.•  .  '  .  'Qi ·the European:. 'Budget by ten billion unit$ o'f. account but_.·.,  _,_.  '  -~~~ ..tould increase public expenditure at all levels of' the _ · · .  ·  than  Product  .  .  -·. Community  by less /11.  of Real.  I  wou.ld  narrow the  dtfferenc~ .'. ~  .· in per capita income  betwee~ the richer and poorer areas of.· ..  .  .  .  . the .  Community  by as  much  as_  101.. : . ,,  ' .- - ·:'? ·  ..  ,  ..  ·~~ ·· ·- Monetary  Union ;.·, .' -~- -·  " .  '  -~-~  ... ~ ••  :1!.  ·•. In  addition  t'~  economic benefits,  a  ·signi£1c::an~ ...  ·.:·  ··  ·  _. ·narrowing of  ·di.vergenc;s between the conmuni ty'  s  more -and  . '  - ·.  '  '  '  :  . ,'  .,  .  ;  ,:<·:"i less prosperous  a1;~~s~ wo~ld of ·c{)~~se also bring the C~~y'  ·_·  _-:ti political gains.  Mosf:  notably). it.- would remove  some  of· the  .  ;;::> major obstacles to  th~ achievement of  European·monet~ry union.  As  you will.httve read,  this is another objective for which  the Commission intends ·tq -campaign  publicly and vigorously,  with theaim of estabLishing a·elim.ate· .  !I  .•  ..  .  '  ... ·sufficiently favoU:rable  to  cause'·Mem~er Governments  to. -· replace it on.  their political agendas. ,~ .. ,. ~~.  .  -~-- -~--· '!he  _conventional -wisdom  currently prevalent in  'mos·t .· of Europe's _national  capitals.is that monetary union is a - ~~-· distant possibility towards which  the Community  ca~ot begin to make  any progress until it masters  b~th inflation and unemployment..  \<."hat  the Commission is trying to  do  is to provoke serious examination of an alternative thesis: ·  ... namely,  that; _far  from it being necessary  to wait for the .. - Community  to ·overcome its economic  problems  before moving to a  sipgle currency,  the relatively speedy introduction of such a  currency would itself greatly assist in solving thE!!l • .  /. ..... '.·""!· .  :~ '·';>_ '  .· '·~  -~~. J.•." . .  - ,~ li  .. -' i '1 ~- - '  ,. .  ' ...  ~  _......, __ :,..-;,.-_.:  ...  -"::,.;;..-:···. ~ .,  ..  · - ~ .  .  ~ .  •l·~·~-;-....  ..s· -,  .. ,., One  reason  ~Jhy ·this would  be  so is that a  sin,le  -~  __ -, •  .:r~ . •,.  ~ropean.  currency  ~Jould be a  far more substantial an9  \  :· ..  ';.· .· ....  ·  ..  .  .  .  .  .  .  .  .  .  .  ·I  !  .  •  .  .  .  ·.  ·: stabl~:: element in the international  exchange  system  . · .. ,  . . than the  e;,;:lsting separate European currencies.  Thi~ would not only have  a  steadying effect on  .. .;orld  t'radJng  ,.  ; :conditions~ but it would also remove  the present conptraints ,  .  .' ..  !'-;'"· ·._on  economic management  ~xperienced by Member  States· ,.n.th ~  (:\ •.  ,..  . ··.  -~-balance of payme_nt_s  _.prob~ems:  inhibitions about  mod~rate re;i:.lation arising from fears  that eKchange  rates  w.ou~d ... fall  p~e~ipi  tately :/in consequence,  vlould be greatly ;-educed;. Moreover,  a  .c;_omrnon  currency- would  ensure  that all  ·th~ trade:_, : which  takef-.1  pl~ce between .the Member  States  themselv~s ,_  · that is about h·::tlf  the Comrrr.J.nity' s  exports  - would  b~ freed  from  any  exchange rate risk whatsoever.  This  ~ould  , be  bound to. g:tve  a  'major boo-st  to confidence and  th~ to industrial investment. '--- J~  ~­~  >  Obviously monetaTY  union raises many  other  an~ ·~- ..  · .·;"_ complex issues,  and  the  outcome of their further  di~ussion~ and examination carinot  ~e certain.  But it would  s~r~ly be Wholly  wrong if a  topic of  such crucial significance were -~  ,~  _,- ---... "':  ••  ;;,_>.•" to  remai.n neglected by  Europe's political leaders, Illferely in consequence of prejudice or intellectual inertia.  To. prevent this happening is perhaps  the most exciting,  and also the most  important challenge which  the present Commission  facf~s  ~ 

Extract of a speech of Christopher Tungendhat, Member of the Commission of the European Communities responsible for the budget, on the "Role of an EEC Commissioner", given to the Westminster Junior Chamber of Commerce. London, 7 October 1977

,-
Extract of a speech of Christopher TUGENDHAT, 
Member of the Commission of the European Communities 
responsible for the·'"Budg'et; on the 
"Role of an E.EC Commissioner", 
given to a lunch offered by-the Westminster Junior 
Chamber of Commerc~, on 7th October 1977 in London 
.--..-· 
~~ld!L ;~~~~~~~:;;,I~IIF;~6~~:i~i~{f;~ .. -.. . 
~~-~· ~:1•d; , ~:k,;:;,.:;:,_~,\-}~-L·:·P~!ec~:;;partcic_i~~~ion 1%1--the·fnl~lic;battie_ of_-~~ ~~~·~j~It~i15~~{J~~~:: "t~~'-so~~~hing. f<l'· ~f~n the n~w Com.! s sio!i attaches _ · 
:•,·:~'i!;~~~';;;~~t·~~;;,·~~~ ~~ofi ~~··; Take · f~r E!l<~le the vexed issue 
.J';: 1{ .. ")!_, ·."'-:' -;jf,._:..~.,,... . ," ·, ' . ' - -- - ' t~--·{'!~~~}t;·~.;:~ ::;5; ..::;'_'::-of the ··common ·Agricultural Policy~ I suspec~ that not 
t :Jt!~-'"~;:1~~~..--~~~~~~:l::r~ ~;. '.l;{ ~'" ~ - ." , - - ... · 
r~;r:~~-:-::r:::/};:')', <milny· people aooreciate that much .of 'the most telling J ;~ ... ~ .. ,., .~a; ... :; : ;_fii :~t-:;~._0:, ~ -·~ -f. > >" • I ~ ~ 
~~J_-··:·::~:~t:·,~_-:'"'~;:~-~~~-> .:.-~d certainly the .. best.~nformed ·~··public critic'ism of 
; ' 
i~"4~~;~~;·;-~-~ -~ .. ~-~?-_'' . - ,_ ' ',.. ~ : '' ', _-,·, '- ' '--' . 
kf'~~t~;f:<:;:::"~~-;-"':~~- -~ ~, the) pr~sent ~:or king of the CAP ha~ been voiced not by the · 
~{ ~t~4(~~-~~~:;·-.,~{i~;~,;>:c~ntty•s ~p<>nents -.'~t .by the Commission itself. t;~~~~~~i~~i;t:,: :,t~f?> ' ' : ' '2 . - .: . . .·. .. . . . . ' ,. . 
f. ~-.J:''ti '~~.~:9:>':;;;< ;;,'L'~ :··. _ ;<'-"· 'nle comnlissipQ iS ._of COUrSe whoJeheartedly COmmitted f~JiB "~~f~~~:i~s~:;~n~i~~::;r:n~:e:i~1:: :::::y~:dony · · 
~;:~6f~~:~~; __ ~·, ·),··.- stability_of' prt;~-.~l'i·~-a- W9rl~ -~~~~a~ene~ by a terrifying 
f~:::t;-;j~):Y:~~~~~>tf'-r··'·, population exp_lost~n_• ... ~t-in .its- present form. the CAP 
,: "',-'>:~;.s-l;:.t/~'-->.~:~_-:~~t:/5_.."'".. • .;;:-:;,;.=·.~--' .·· .. ·"-/ . .._ .- , .. _. •' •, ·.-...~ - ~·:· ' . ' ,,t\~•:it?":.r::~:~,;:::;~}\i~';;~;:: is ~undeniably .di~figured by unsightly blemishes, in _ .··· 
. particular by excessive anct costly surpluses ·and by the 
·too ext:ensi;e ~se of ·.Mon~-ta.ry~ compensatory _Amounts. And 
in .:its' effortS: to ensu~~' that·. th~se defects are remedied,·. 
·-·· ' ~ . . . ~. . - - . . . !t - -.- . :· . . -
the Commission ha_s· not merely l"repared concrete 
pr<>posals for r:eform; . it has· also striven to create the 
: . : ~ ' . . . 
;~·:;,,>::;;;,}::'~':':-':;;.>"' _ necessary degree of p'olitical ·will ·w£~hin·the Agricultural 
'{)~;~:,~::~q~f!rr~:: ~- ~. ·. Coti~cil.of~ Ministers• by:, ~aking every opportunity to.·· ... 
,-.• :,; '~ .. ·-;-:;. ~- . -·=:-'' _ _,. 
_-:.-.~-- "" _-;,. ,:,:~ . '··. ~.\,'. -.:-
~lt![!~~~:c 
~·i"~t!,r{:~i.\f,;··· ···  
~ :··. ~ .. -~_ ... _~ \~;~;~... ·,}· -
cr~~e a be-tter understanding, at the_ ·level of national 
_· . -··· -.. :_,_·- . ;.'· . . .... ~- ~ - . ·. ·l, .. 
; 
politics, of exactly how surpluses arise, of how serious 
they have now.become. and of the_precise finaQ.cial 
consequences of failing to reduce them. 
./. 
-..... 
~ 
. 0. 
~ 
-. 
,:::>.-~"'-~; ·. 
;";;~.'--.·--~~-J_?}_~~~_iit.•···'.:_;:-_-~. -_~e_: ...... _:.~ __ · ._ ,_ th_~ · '$UCt:ess .• : ·In tliis,·yeart·a annual .. __ .,,.-,,~~·~ :~~ ~:.; " _ ·.:~ , -. e ' - · ' ' :, . ·' ·· .>:''''<; :,• ·. , oT~~ ;. : :,, ,::;:,' , : /:. ' ' , , '.'; :·2'';:(:_:, · ::[;X:~• i~ 
~:t"t.~~ ·-.\:"'~,>c \!· - ;:;:~: '"' Faraa · Price ·review tlla · Conmlrpi ty '.a· .Fa~;M1n1a te;is · f•i t ·- ::-~I-'1·-~::~~~~t :;:~ ~~~Jt:~·J·r~.;··''::::rirLj~a:~e:·:ea:::f~~!:::::·· ••tin~:::;t~~.:·{!?~:,·•( -~ 
. . . '' :::, '- . . . . . . . . •·. . . . ~,~.~~ .... 
·. ·• aceesslon, and ~: fairfy· ~dest ·fig\lre ~en.: it _is.· ccimpared.:Wit:h· 
the rate . . . .·. ... . ; ·· .. _..-. 
oJ:,-> inflation in the Community as a ~ole~- -.-- .. · -.· -
~ . ' ... - . . -
_:-·-~ • <,- .. 
'-··. 
• . ·• • '. ·r • . ·~ 
"~ .!';J · .• ~ .. ·;j, •• ~- ···-"<_ ..... --~ ··• 
~netheless. ev~n_ :3. ~ is: ·a ·ft~re_ higher than ~e 
• Cotmd.sst<.m initt~ll; :~~commended to' the ·.councif~_ .. 'And in 
:...:.·. 
a numbel;, of -speec~es: ti~d ar.ticlej ::X have sugge'~te~ th~t ' : 
·:institutional c;hang~~: -~;;~- .rie~es_s~ry:· in the_ way· ·d1~- coti~cil' · 
. . ' . . ~ - · ... _ . 
. mak~s .de-cisions i-q order to enaure the more effective •' 
representation· of non. ·agricu_lturai interestis. :;,. ·in. particular· 
by pers~stently dra~ng attention ·tO the- defects ·of . th~ -
__ ( · e,;isting decision makthg machinery~- I S.ndJny .colleagues-' .' ~ ~ . 
- .. ·_·. .. ~-~:.C~' .-. . - . ,~~·- ... 
.. Will foster-. the necessa;y. awareness· and &terinination among 
. - . ~· . ' . . - . 
. ; ·~_:":-~--~-~~~ .thos~ationai politicians With whom t_b.e respons:lbi~ity 
·--.-"">': ' <"'' • '< •• '· ·.· . • '· ··' •· . •• 
".· . . ~-. 
' for effecting a changd· ultimat~ly .rests •. · 
·.'- .· :. -" . ;., . . . _ .. , 
.It is vital th4t we succeed in this object.ive sooner 
·,·r 
' -
. rather than ·later. Fdr the enlargement of the_ Community 
·. -t'. 
to include Greece, Portugal and Spain wfll_greatly-add 
to the scale and complexity of the CAP. In these 
_··circumstances to continue· to make the mistakes of the past 
._··would -be to invite consequences. much worse than anything 
we have so-far exoerienced. 
./. 
. . 
.. , ·, 
.·-· .. · 
. :G., 
_, ..... · 
._::"'-. 
:Anothe;/c'bon~~rh of the present Commission is to· 
- . ·'".:, .. -~ ' . 
fuller publ:tC."·appredlat~on of-. the case for an ~--
. "• : 
Fund ~Fas setup_in '1;973,: with funds- allocated: · - ·. '. 
in the-f.irst instance,' for a four year period. , 
.. -. :'"' ~- ' 
Ine~ittfbly~t the initial sums ·committed were small. 
ncrv-.r .that the Fund .has had titl!le to prove its usefulness, .. 
Commission is endeavouring to convince the Hember 
C;··st:ates of. the advantages of not merely contirnifng, but 
_ •. __ of <Sigqificant::ly expanding it • 
• ··, - '{!; ·- ' ' ' 
- _.; ' 
. . ) .. ' .. 
One imp<:rrtant m_eri t -.of a common ·approach to regional 
policy to whichwehave t::ied.to_ draw attention is that 
i.t makes it pos'sibie to construct a system of regional 
· .. · -- ' ._ .. 
incentives """'hich ·does not ·entail mutually destructive 
competition between different Member States as they race . 
· to overtake each othe-r on the subsidy escalator.· 
· It is true that hn increase in the Regional Fund ·· · 
would place an extra financial burden on some of the richer 
Member States w"h.o, as··a.t present, would receive back in.·-
... 
direct financial aid from the Fund a good deal less than 
they~-would have to pay in.. But for all the Member States -
rich and poor alike - there would be other less direct 
but not less significant economic benefits. For all its 
Members, the main economic rationale of the Community is 
that it offer;;; em e substantial, stable and re~dily 
important consc;;qz.!ences ;;. policy bringtne nt:~W prosperity 
to Europe's more bac1: .. :srd regio7 \::C would ~12-· ~':o enable the 
service unon e.n even more impres.:;:; 
·",: .. 
;}· -..... ·: 
.·) ..;-
.. 
,.-:j .~>. 
; _; . 
.... .,,..;. __ ... '"";_ 
-opt~\\!~!~-- 'j~~lt_~~~~4:·<t_J~; ..r~~-- ·~:~-: ' i; . . -1: ~ 
.. ""'~·.,., . .,, ~-.·.,..N·{_:_6.\-,~--~~ .• ::;~:_<>_-~~J_:: ·- .,--,_ -'~~-;--·_:~ ·' . : -~_,.~_,· . 
0\ . ; : ·.·~ ... , , . ' . , . . ' .·.-·--- . ~--~.-.-.:._;·i';:f·;''-.. n'·.· •• ;···;,';.·· . ... .  ~_:: "?:c;0J; 'i ":'~~ . . ' ' : . _· . .   . . .. ·. ~ -i~
l\:&rthermore, the' 'c6s~ of ·~\ eff_ective _!egtonal pol1cy' ~: -~;r~ 
·L · need. not be very great. ·_ . The MaCDo~gall' Commit.tetfr... a Working· t1~ 
. - . . . . .~ :; ~- . . . • ' ~:;J -~art~· sa~'- up under_ ~he 'auspices o( the Comnis-siort - concluded ~1~ 
'··'· }~ that~,aJ'.~cka$e ·o~ prpposals whicp ;e estimat.es ~~oulci increase ,;;li1 
\.• . ' . 'Qi 
·the European:. 'Budget by ten billion unit$ o'f. account but_.·., _,_. ' -~~~ 
..tould increase public expenditure at all levels of' the _ · 
· . · than Product . . -·. 
Community by less /11. of Real. I wou.ld narrow the dtfferenc~ 
.'. ~ .· 
in per capita income betwee~ the richer and poorer areas of.· 
.. . . . . 
the . Community by as much as_ 101.. : 
. ,, ' 
.- - ·:'? 
· .. , .. ·~~ 
·· ·- Monetary Union ;.·, 
.' 
-~- -· " 
. ' -~-~ ... ~ •• :1!. ·•. 
In addition t'~ economic benefits, a ·signi£1c::an~ ... ·.:· ·· · _. 
·narrowing of ·di.vergenc;s between the conmuni ty' s more -and . 
' - ·. ' ' ' : . ,' ., . ; ,:<·:"i 
less prosperous a1;~~s~ wo~ld of ·c{)~~se also bring the C~~y' ·_· _-:ti 
political gains. Mosf: notably). it.- would remove some of· the . ;;::> 
major obstacles to th~ achievement of European·monet~ry 
union. As you will.httve read, this is another objective 
for which the Commission intends ·tq -campaign publicly and 
vigorously, with theaim of estabLishing a·elim.ate· 
. !I .• .. . ' ... 
·sufficiently favoU:rable to cause'·Mem~er Governments to. 
-· 
replace it on. their political agendas. ,~ .. ,. 
~~. . -~-- -~--· 
'!he _conventional -wisdom currently prevalent in 'mos·t .· 
of Europe's _national capitals.is that monetary union is a 
- ~~-· 
distant possibility towards which the Community ca~ot begin 
to make any progress until it masters b~th inflation and 
unemployment.. \<."hat the Commission is trying to do is to 
provoke serious examination of an alternative thesis: · 
... 
namely, that; _far from it being necessary to wait for the 
.. 
- Community to ·overcome its economic problems before moving 
to a sipgle currency, the relatively speedy introduction 
of such a currency would itself greatly assist in solving thE!!l • 
. /. 
..... 
'.·""!· 
. :~ 
'·';>_ 
' .· 
'·~ -~~. 
J.•." 
. . - ,~ 
li .. -' 
i 
'1 
~- - ' ,. . ' 
... ~ _......, __ :,..-;,.-_.: ... -"::,.;;..-
:···. ~ ., .. · 
-~ . . ~ 
. •l·~·~-;-
.... ..s· -, .. ,., 
One reason ~Jhy ·this would be so is that a sin,le -~ __ -, 
• .:r~ 
. •,. ~ropean. currency ~Jould be a far more substantial an9 \ :· .. ';.· 
.· .... · .. . . . . . . . . . . ·I ! . • . . . ·. ·: 
stabl~:: element in the international exchange system . · .. , . 
. than the e;,;:lsting separate European currencies. Thi~ 
would not only have a steadying effect on .. .;orld t'radJng 
,. ; 
:conditions~ but it would also remove the present conptraints 
, . .' .. !'-;'"· 
·._on economic management ~xperienced by Member States· ,.n.th 
~ (:\ •. ,.. . ··. -~-
balance of payme_nt_s _.prob~ems: inhibitions about mod~rate 
re;i:.lation arising from fears that eKchange rates w.ou~d 
... 
fall p~e~ipi tately :/in consequence, vlould be greatly ;-educed;. 
Moreover, a .c;_omrnon currency- would ensure that all ·th~ trade:_, 
: which takef-.1 pl~ce between .the Member States themselv~s 
,_ · that is about h·::tlf the Comrrr.J.nity' s exports - would b~ 
freed from any exchange rate risk whatsoever. This ~ould , 
be bound to. g:tve a 'major boo-st to confidence and th~ to 
industrial investment. 
'--- J~ ~­~ > Obviously monetaTY union raises many other an~ ·~- .. · 
.·;"_ 
complex issues, and the outcome of their further di~ussion~ 
and examination carinot ~e certain. But it would s~r~ly be 
Wholly wrong if a topic of such crucial significance were 
-~ ,~ _,- ---... "': •• ;;,_>.•" 
to remai.n neglected by Europe's political leaders, Illferely 
in consequence of prejudice or intellectual inertia. To. 
prevent this happening is perhaps the most exciting, and 
also the most important challenge which the present 
Commission facf~s ~ 


Extract of a speech of Christopher Tungendhat, Member of the Commission of the European Communities responsible for the budget, on the "Role of an EEC Commissioner", given to the Westminster Junior Chamber of Commerce. London, 7 October 1977

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