UK Economy, Doubts on Unity Threaten Major

As EC leaders aim to salvage union treaty, British premier faces growing controversy

LEADERS of the European Community have given themselves an eight-week deadline for persuading the EC's 300 million citizens that the Maastricht Treaty is the key to Europe's unity and prosperity in the 21st century.

But their special summit meeting in Birmingham, England, on Friday has been overshadowed by a British political crisis that appears to threaten the future of John Major, the host prime minister, and may impede attempts to inspire greater popular confidence in the EC. As the 12 EC leaders were assembling here, the prime minister and his government unexpectedly became engulfed in a crisis over the closure of more than half of Britain's coal mines. The shutdowns have spawned a huge controversy that is expec ted to come to a head in Parliament on Wednesday.

The centerpiece of Friday's summit was a 600-word draft statement - the Birmingham Declaration - promising to provide the EC with a more human face.

The leaders confirmed that they would meet again in mid-December in Edinburgh, Scotland, and unveil a package of measures which, according to Mr. Major, would "bring Europe closer to its people" by promoting more openness and democracy in the conduct of EC affairs. The measures could include addresses by Brussels officials to national parliaments and the publication of policy documents ahead of EC legislation.

A British source conceded as the summit ended, however, that there had been no tangible progress on currency matters, and that the Birmingham Declaration was "a statement of principles, not an agenda for action."

Jacques Delors, president of the EC Commission in Brussels, warned that there were no "miracle cures" for Europe's current malaise. In an hour-long discourse on the decentralization of power to national EC governments - called "subsidiarity" in Brussels jargon - Mr. Delors said he was against attempts to alter the balance of power between the Brussels bureaucracy and national governments.

Such comments suggest that Delors will oppose countries, including Britain and Denmark, that insist that the European Commission is too powerful and must be curbed.

For Major, the Birmingham summit was profoundly frustrating, British officials admit. As current chairman of the EC Council of Ministers, Major called the summit last month in the midst of a European currency crisis and rising fears that anti-Maastricht sentiment would prevent ratification of the treaty by all 12 member states.

German, French, and other national representatives to the EC said Major was under acute strain during the summit. News of the coal mine shutdowns, which involve the loss of 31,000 miners' jobs, triggered a controversy in which parliamentarians normally loyal to the government attacked the decision as "economic madness" and accused the prime minister of weak and erratic leadership.

Michael Heseltine, president of the Board of Trade, spent the weekend working on a package of measures aimed at easing the plight of the sacked miners and rallying Conservative Party support for the closures. Tory support failing

But yesterday two newspaper surveys of Conservative members of Parliament indicated that enough of them were threatening to vote against the mine closures to ensure the government's defeat in a Commons vote scheduled for Wednesday. The surveys were published amid a torrent of media comment lambasting Major and openly doubting whether he will remain in office.

Last night miner leaders asked Britons to switch off all lights and electrical appliances for several minutes to signify that many millions of people opposed the mine closures and were aggrieved by signs of a deepening economic recession.

Major's woes deepened during the summit when a 1 percent interest-rate cut ordered by his government drew a chorus of disapproval from currency traders. The pound continued to slide on international exchanges.

In addition, continuing deadlock between the EC and the United States in the Uruguay Round of trade negotiations gave the leaders cause for caution in assessing what they had achieved.

Major told the summit that EC-US talks had made "much progress," but Elizabeth Guigou, France's minister for Europe, complained that the weakness of the dollar was a serious obstacle to French acceptance of a trade deal.

A senior French official said the farm lobby in his country was opposed to deep cuts on subsidized exports of food. According to one British source, the statement appeared to indicate that France was unwilling to implement reforms of the EC's agricultural policy already accepted by the French government. Government threatened

Britain will preside over EC affairs until the end of the year, but Labour opposition leader John Smith raised the question over the weekend whether Major will stay in office that long.

If the British prime minister were forced to resign, it would be a serious setback for the EC's attempts to rescue the Maastricht Treaty after its narrow rejection by Danish voters and its grudging acceptance in a French referendum last month.

Following up on the Birmingham Declaration will require Britain to lead the rest of the EC in drafting measures aimed at quelling fears that the Community is too remote from the people.

If a new prime minister has to be found, or a general election is called, Britain will be poorly placed to give the Community that leadership. Major's defeat would threaten the introduction of a Maastricht ratification bill in Parliament before Christmas.

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