The outlook for UK European policy at the year’s end: long winter ahead or chance of an early spring?
By Dr Daniel Furby
The final months of 2011 were intemperate ones for UK European policy. The government’s victory over Conservative Eurosceptic MPs in the House of Commons proved fleeting; October’s motion on whether to hold a referendum on continued EU membership may have been defeated, but the true measure of its impact can be understood best in light of the December European Council.
Some have argued that there was little justification for a negotiating position whereby the UK sought quid pro quos - including the right to exempt Britain from some EU financial regulations – for something which perhaps should never really have been ours to grant: the reopening of the Lisbon Treaty to introduce new rules for fiscal governance within the eurozone. Given that Britain would have experienced little difficulty in exempting itself from these rules, it may have been better (for the UK and eurozone alike) to permit treaty change and thus show solidarity with allies at a time of deepening crisis. The recent snows in northwest Europe are in keeping with the cold winds currently blowing through UK-European relations.
The principal question for 2012 is whether these inclement conditions will persist. Will the separation between Britain and the EU mainstream become entrenched, or will Downing Street and Whitehall determine upon a strategy to weather the current blizzard and avoid the dangers confronting the UK’s present and future relationship with Europe? The outlook is at best a mixed one.
The wintry conditions are making their mark closest to home. A sibling schism has erupted between Britain and France over the hitherto obscure subject national of credit ratings. The poor parlance began with French President Nicholas Sarkozy’s likening of Cameron to an ‘obstinate kid’ (a reference to the prime minister’s actions at the December summit) and was carried on by the unflattering remarks of the French Finance Minister, Francois Baroin, and central bank governor, Christian Noyer, on the comparative health of the British economy. The transparent effort to deter, or at least defer, a credit rating downgrade for France provoked considerable irritation in Britain, up to and including the Europhile Deputy Prime Minister, Nick Clegg.
As apt as the proverb about stones and glass houses may seem, the French could also point out that the first pebble was directed from the other side of La Manche. George Osborne’s comments on the financial difficulties facing continental governments – ‘You are not interviewing a European finance minister who is currently terrified that he can’t sell the country’s debts’ – which included a specific reference to France, were bound to rankle with Paris and may in part explain Baroin’s decision to wade in to this particular row. Yet the significance of all this for the UK’s wider relationship with Europe is slight. Anglo-French agitation is very old climatic phenomenon, and the present spat will quickly be forgotten – a localised storm, readily contained within the idiomatic English teacup, or perhaps more fittingly at the festive season, a French verre à cognac.
More troubling, perhaps, is the atmosphere in sections of a different French-speaking capital: Brussels. At the European Parliament (EP), in particular, the week following the December European Council gave rise to some striking signals of disaffection with the UK government. Most dramatic was Joseph Daul, the chair of the centre right European People’s Party (EPP), the largest political grouping in the EP, who suggested that MEPs might be inclined to riposte Cameron’s ‘veto’ by questioning the need for the British budgetary rebate. It is unclear whether Daul’s statement is reflective of currents of opinion within his native France more than it is of attitudes within the EPP, but there should be no doubt about the existence of a more general frustration with British awkwardness within the EP.
Guy Verhofstadt, leader of the Alliance of Liberals and Democrats (ALDE), which includes British Liberal Democrats, demonstrated his irritation by refusing to speak English during the plenary session in Strasbourg. As tempers cool, it seems unlikely that this frustration will actually translate into EP decisions directed against Britain, but a greater danger lies in the possibility that British MEPs, such as those within the ALDE, will find that they carry less influence within their respective political groupings and are therefore less able to advance and defend British interests and perspectives. Given that the Parliament now enjoys legislative equality with the Council, the situation within the EP certainly constitutes another frosty feature on Britain’s European horizon.
Yet the most critical factor in forecasting the probability of a long winter for UK-European relations is not what has happened, but what is still to be done. The greatest hazard confronting UK European policy in the first months of 2011 is its exclusion from the new intergovernmental treaty. Plenty remains unclear about the content and coverage of the new treaty, but should it lead to a further formal distinction between Britain and other EU member states, exacerbating the existing division between eurozone ‘ins’ and ‘outs’, the danger is that Britain’s current troubles will get worse. In particular, should the compact pave the way for intensified discussions between eurozone (and other EU) members on economic and financial affairs, and Britain remains absent, London’s ability to shape future EU policies in these areas could be badly compromised.
There is every reason for the UK to try and regain momentum lost with its EU partners after the December Council meeting, up to and including joining the prospective intergovernmental treaty (the UK currently holds observer status in the negotiations). This does not mean that Britain would have to accept the new fiscal rules introduced, but it would minimise the danger that the UK might be excluded from future talks on questions of fundamental significance to British interests: the City of London and the single market. Should the UK embark upon a genuine process of re-engagement with EU partners, there may yet be hope that 2012 will bring an early spring.
There are firm grounds for a more optimistic outlook: the dark clouds currently residing over the UK’s relationship with Paris and the European Parliament begin to dissipate as the geographic focus shifts eastwards. The recent meeting between British Foreign Secretary William Hague and the German Federal Foreign Minister, Guido Westerwelle, in addition to Angela Merkel’s comments about Britain remaining an important partner within the EU, afford ample evidence that Berlin is anxious to avoid a UK drift to the margins. On the possibility that Britain might still participate in the fiscal compact, Westerwelle was clear: ‘with goodwill it is doable’. Whether it is done will depend primarily upon the government’s readiness to soften the stance taken on the EU Treaty.
For the moment it is tricky to be certain where things will lead, the foreign secretary is holding firm to Britain’s request for countervailing concessions. The explanation for why other EU member states should go to such lengths to deter London from isolating itself remains elusive, and despite Business Secretary Vince Cable’s recent equivocation about the consequences for Britain of the December Council, the coalition government should be in doubt where the balance of British advantage lies; participation in the intergovernmental treaty – with or without concessions to the City of London – easily trumps the continuation of the status quo.
That Britain’s constructive participation in the EU is welcomed in many parts of Europe is also clear from statements such as those of Polish Foreign Minister Radoslaw Sikorski during his Berlin speechin November, in which he highlighted the many positive contributions Britain has made to the development of the European Union. A similar sadness at UK Euroscepticism was evident in Swedish Foreign Minister Carl Bildt’s Twitter comment immediately after the December Council:‘Worried that Britain is starting to drift away from Europe in a serious way. To where? In a strong alliance with Hungary…’. From the Netherlands to parts of central Europe (for a fascinating analysis on the latter theme, see the ‘The UK-EU split’ by Thomas Valasek of the Centre for European Reform) a UK retreat to the margins is viewed with concern.
Forecasting the future of UK-European relations is an inherently hazardous activity, and the present political map reveals a mixture of bleak and brighter elements. There is a genuine desire in many parts of the continent to see Britain re-engage with its partners and retake its seat at the negotiating table. The costs to Britain of joining the prospective intergovernmental treaty are negligible or non-existent. It would inevitably entail a partial loss of face domestically, but this should be more than offset by the knowledge that the government would be acting in the country’s long-term interest. If the UK fails to walk against the winds of national Euroscepticism now, it may simply be blown along with them in the future, and the wintry conditions which currently confront UK European policy will only grow harsher.