07/08/2013 14:42 BST | Updated 07/10/2013 06:12 BST

Rock of Ages

It was the wily old British prime minister, Jim Callaghan, who got Gibraltar right. Discussing the problem with his Spanish opposite number soon after Franco's death, Callgahan said: "You know, you catch more flies with honey than with vinegar."

It was the wily old British prime minister, Jim Callaghan, who got Gibraltar right. Discussing the problem with his Spanish opposite number soon after Franco's death, Callgahan said: "You know, you catch more flies with honey than with vinegar." Exactly the same dictum exists in Spanish but as the 50th anniversary of Franco's death approaches it is the vinegar bottle rather than the honey jar that has been opened.

When Spain's present ambassador, Francisco Trillo, left Madrid he was asked what his ambition for his term of office was: "Recover Gibraltar," he replied. Por Dios! There is as much chance of Britain handing over Gibraltar as there is of Spain handing back Ceuta and Mellila, the two small Spanish enclaves on the Morocco coast.

As the French said of Alsace and Lorraine under German control between 1870 and 1918, "Think of them always, talk of them never." For good or ill, the same rule should apply in Gib. The more words, the hotter the temperature. The likeable young Oxford educated lawyer, Fabian Picardo, who is Gibraltar's chief minister, says Spain is like North Korea or reverting to Franco era behaviour. He really should know better. The prime minister might have stayed sunbathing in neighbouring Portugal rather makes headlines. The Spanish foreign minister tries to score political points by saying the era of soft-soaping Gibraltar under the previous Socialists is now over. And for Mr Cameron's opposite number, Mariano Rajoy, under accusation of taking money for his party from rich Spaniards (alas poor Sr Rajoy has no House of Lords to pay back party political donors) the chance to get headlines in support of Spanish fishermen and poor Spaniards who live clustered around Gib with its whiff of John Le Carre style off-shore money-making is too good to miss.

Too many Spanish and British politicians have Gib scars on their back. I first came across the island when I was offered jollies down there as a backbench MP. Although nominally under UK control, Gibraltar runs its own affairs which include a very expensive lobbying operation in London. Any MP who wanted a trip to the sun just had to call. While Gibraltar lawyers and businessmen worked the Tories, the Gibraltar Socialist Labour Party and the then Transport and General Workers Union (now Len McCluskey's Unite) caressed Labour under the charisma of Joe Bossano, Gib's smartest political leader.

I declined the freebie but felt a general sympathy for Gibraltar as Europe is full of oddities - Monaco, the Channel Islands (Les Isles Normands in french), San Marino, islands in the Baltic, indeed Ceuta and Melilla - which add to Europe's charm and do no harm. My engagement with Gib heated up when I became Europe minister and had to defuse a bizarre episode in the usually intelligent FCO handling of the Rock. For some inexplicable reason Jack Straw got it into his head that he could negotiate a deal with Madrid to 'solve' the Gib issue. Maybe Tony Blair's (and George W Bush's) closet European amigo, José Maria Aznar nagged at Blair to help on Gibraltar. Ever since his National Union of Student days, Straw has had a great belief - often justified - in his ability to solve knotty political problems. The Spanish could not believe their luck and promptly set up a giant bureaucracy to search for a deal with London. Two small things were left out. The first was the people of Gibraltar and the second was parliamentary opinion. The Gibs reacted furiously and the Tories were given an open goal.

As the Gib-Tory alliance won headlines in the Mail and Telegraph about betrayal and Jack Straw was booed off the Rock, Robin Cook sighed to me, "Why has Jack done this? The Gib file should remain sealed at the bottom of the deepest FCO drawer." Straw and his aide Peter Hain were sincere and serious but neither spoke Spanish and had little idea of the passions the Gib question could unleash both on the rock and in Madrid. When I took over as Europe minister I just shut down the story. I was on the front pages of El Pais and El Mundo by comparing Gibraltar to Ceute and Melilla. The Spanish prime minister, Jose Maria Aznar, complained about me to Tony Blair but this was a lose-lose fight. When the Spanish socialists with whom I had good contacts thanks to investing in time and travel to Madrid arrived in power in 2004 the atmosphere changed. They brought the Gibraltar politicians into the talks and since Spanish is the first language of Gibraltar, they quickly cut a deal including direct flights from Madrid to Gibraltar.

I went there when I could as a minister. I talked to trade union friends close to UK unions and found they all lived in Spain and were as much Andalusian as English... The Rock is so small it depends on Spain for everything. I got the FCO library to dig up the original Treaty of Utrecht and read it in Castilian. It stipulates there shall be no contact by land with neighbouring Spain and no Jews or Muslims should live on the Rock. Since I like open borders and free movement of people I hoped a sort of European spirit might dissolve tensions. This seemed to work until the Socialists were ousted. Now it is a Labour chief minister who won office by saying he would get tough with Spanish fishermen. He has now dumped 75 giant concrete blocks with metal prods and hooks sticking out in the waters off the Rock to stop Spanish fisherman collecting molluscs. This has produced the equal if not greater response from Madrid and queues at the border getting as bad as at Stanstead when Ryanair flights arrive all at once late at night.

If the Gibs have a lobby in London, the impoverished Andalusian villages around Gibraltar have their friends in Madrid. It is time for calm diplomacy to be given a chance. Spain, Britain and Gibraltar will all lose if this row continues.