Graham Bishop's blog: Fresh Start Tories seek Dead End for Britain by unwinding key Thatcher achievements in Europe
Just as the dust seemed to be settling from the infamous Cameron “veto” of December 9th, the Fresh Start group of allegedly “more than 100 Tory MPs” has attempted to throw another grenade into Britain’s relations with the EU. Since that black day, the City and the UK Treasury have been patiently trying to re-build Britain’s credibility as a constructive member of the EU to remove the risk that Britain had just jumped off a political cliff – as I put it in December. The UK has been taking a much more conciliatory stance than I expected then, and I have observed that the rest of the EU has responded positively to this approach.
Far from creating a Fresh Start, this group is now proposing policies that are far more likely to lead to a Dead End for Britain. Yet they have accurately spotted the political logic that will drive the other 24 signatories - not merely the euro area states - of the new Treaty on economic governance to act as a group. So the arithmetic will be even worse than their analysis (see the box below).
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The crisis in the eurozone has prompted George Osborne to state that: ‘the eurozone countries need to accept the remorseless logic of monetary union that leads from a single currency to greater fiscal integration’.
If such action is indeed inevitable, then one effect may be that the eurozone countries start to act as one voting bloc in the European Union. This would have a massive impact straight away and it would intensify: by 2014 or 2017 the eurozone will have the 65 per cent of votes needed to pass a law by themselves.
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The Dead End is even more apparent from the demand for a Treaty change to give Britain a veto on financial services legislation (see box below). Why would the other 26 Member States agree to this special exemption for Britain without asking a for a few little exemptions from the single market for themselves. Perhaps Germany might ask for some exemptions to deal with competition from non-EU owned car manufacturers – that by chance happen to operate out of the UK? That was exactly why Margaret Thatcher insisted on QMV in 1986 to create the single market in the first place. What an extraordinary turn of events for the Conservative Party to be undoing the seminal work of Mrs Thatcher!
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It would also be possible to seek changes to qualified majority voting rules or employ a mechanism introduced by the Lisbon Treaty – the so-called ‘yellow card’ which forces the European Commission to reconsider a proposal if one-third of all national parliaments object to it within eight weeks of it being tabled. More drastically, the UK government could seek a unilateral brake on EU financial services regulation. Open Europe outlines a possible UK emergency break or ‘double lock’ approach, embodied in a legally binding protocol attached to the Treaties. Lock One would assert the special circumstances that are the UK’s stake in the financial services, requiring the Commission to reconsider proposals that impact disproportionately on the UK. (A FTT would be an obvious example of that). Lock Two would give the UK a right of appeal for any proposal at any stage during the decision-making process before the proposal had been agreed by the Council and European Parliament. This would give the UK a veto, because at the European Council level unanimity applies. |
