Britain will win if it leads reforms for the whole of the EU but risks losing if it demands a special deal
By Phillip Souta
A story in today’s FT(£) by George Parker trails the announcement of a long-awaited coalition agreement commitment to review the “balance of competencies” between the UK and the EU. This will be a process David Cameron will want to keep a very close hold of as it risks causing him major problems with his self-avowedly euro-sceptic backbenchers.
Those who want wholesale repatriation of large pieces of the social and employment laws making up the EU’s single market are set to be disappointed. David Cameron and William Hague know it is not on the table – they have been told so by France and Germany, point black. They see it as an attempt to enjoy all the benefits of the single market whilst ditching the obligations Britain finds irksome, and there is no appetite to give us a special deal.
The other argument David Cameron will have to face down is that those demands should be our price for agreeing whatever the eurozone ultimately needs to do to get out of the current crisis. There are two issues there. First, getting out of the eurozone crisis is an end in itself and a UK priority, so putting a price on it stretches credibility, and at worst, could be seen as a cynical ploy. Secondly, as we saw last December, if Britain says “no”, it will be ignored by the vast majority who will proceed regardless.
The “review of competencies” is therefore unlikely to provide the red meat craved by so many on David Cameron’s back benches.
The process could however be turned on its head from what the Douglas Carswells of this world want into something genuinely constructive.
Instead of asking for a special deal for the UK, the UK should argue for reforms for all the EU’s member states, and lead a coalition of like-minded members to achieve them.
Three specific reforms spring to mind immediately.
First, the working time directive, whilst introducing significant improvements in people’s working rights, is far from perfect. Opt outs from the 48 hour working week should be formalised across the EU for those who do wish to work longer, and there is a strong case for the SiMAP and Jaeger cases classifying “on call” time as working time to be re-examined.
Secondly, the common agricultural policy continues to account for too much of the EU’s budget. The Commission’s proposals for the 2014 to 2020 budget see 37 per cent of the EU’s common funds being spent on “preservation and management of natural resources (including CAP)”. The CAP artificially increases food prices in the EU and UK, is bad for development of poorer countries, and diverts funds from support for research and development.
Thirdly, currently poor regions of rich members get cohesion funds. There is a strong case to say that rich states should look after their own regions with an average income of below the 75 per cent EU average. We estimate that this would save the EU €91 billion over seven years from 2014.
These are specifics which do not even touch on completing the single market which should be the UK’s number one priority, but are quite particular alternatives to the “special deal for Britain” proposals some would like to see.