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Home Opinion Cameron's EU reforms: steering between the trivial and the impossible
EU • UK • Reform

Cameron's EU reforms: steering between the trivial and the impossible

Richard Corbett - 08 July 2015

The prime minister's demands for the future of the EU vary hugely in relevance and plausibility

With the referendum on Britain's membership of the EU now a certainty, David Cameron now has to finally spell out exactly what EU reforms he intends to seek. He does this knowing full well that proposals cannot at the same time satisfy his rightwing backbenchers and Britain's EU partners. Looking at the headings he's mentioned so far, they are a mixture of the silly and the sensible, of the easy and the tricky, of the relevant and the irrelevant. At the same time he is ignoring some open goals.

Judge for yourselves what comes under which category:

Getting out of 'ever-closer union'

Securing this change would require maximum political effort (treaty change, unanimously agreed and ratified) for minimum impact (this wording appears in the declaratory preamble of the EU treaty and in the aspirational Article 1, and has no direct legal effect). Changing it would be purely symbolic.

In any case, the full text is “an ever-closer union among the peoples [not the states] of Europe in which decisions are taken as closely as possible to the citizen in accordance with the principle of subsidiarity” — the principle that the EU should act in as decentralised a way as possible.

This wording was actually secured by John Major, when negotiating the Maastricht treaty. The original 1957 treaty had simply said "ever-closer union".

Concerns about too much centralisation in the union have already been addressed in the binding legal requirements, set out in Articles 4 and 5 of the treaty itself rather than in the declaratory preamble, whereby the EU:

● may act “only within the limits of the competences conferred upon it by the member states in the treaties” (principle of conferred powers)
● and even then act “only if and insofar as the objectives of the proposed action cannot be sufficiently achieved by the member states” (principle of subsidiarity)
● and even then “the content and form of union action shall not exceed what is necessary to achieve the objectives of the treaties” (principle of proportionality)
● and it must “respect their essential state functions” of the member states including national security which “remains the sole responsibility of each member state”.

These guarantees were secured by the Labour government when negotiating the Lisbon treaty.

They are further guaranteed by the fact that EU procedures require the approval of the EU council – composed of national ministers from the member states – for the EU to take any legislative action to implement the treaty. These legal requirements demonstrate that the idea of a centralised union replacing Europe’s member countries is a myth.

What Cameron might fall back on is the text he managed to get into the conclusions of the June 2014 European council meeting which interpreted ever closer union in the following way:

"The European council noted that the concept of ever-closer union allows for different paths of integration for different countries, allowing those that want to deepen integration to move ahead, while respecting the wish of those who do not want to deepen anymore".

It could be a possible to get this text, already agreed by all national leaders, turned into a solemn declaration interpreting the treaty, reassuring those who really think this is an issue.

Red card for national parliaments

Cameron says parliaments must be able to “combine” to block regulations – he has not taking up Bill Cash's suggestion that a single national parliament should be able to exercise a "red card" – which would amount to a unilateral veto.

Under existing procedures, national parliaments can object to European commission proposals on the ground that they go beyond the EU’s remit (principle of subsidiary). If one third of them object, the commission must withdraw, amend or justify its proposal. This is known as the “yellow card” procedure. If half of them object – an "orange card" – it triggers a similar review by the commission and specific votes in the council and in the European parliament whereby either one can kill off the proposal there and then if the commission has not withdrawn it.

Now, the “yellow card” procedure has been triggered only twice in the five years of its existence. The orange card has never been triggered. The thing is that proposals can be killed off anyway later in the procedure, in the EU council, where national ministers essentially have a “red card” – nothing gets through if a "blocking minority" of them reject it.

The other reason that the procedure is so little used is because subsidiarity is, in practice, rarely an issue. Most EU legislation nowadays is about amending existing EU legislation rather than venturing into new fields where subsidiarity might be an issue.

So Cameron is proposing to reinforce a little-used procedure that simply duplicates an easier option to block proposals later on. It is at best an extra safeguard, but is not spectacular.

He also neatly avoids the obvious way to strengthen national parliamentary scrutiny – one which would not be restricted to questions of subsidiarity and one which does not require negotiation with anyone! This would be to apply in Britain what the Nordic countries already do – to require any minister going to a meeting in Brussels to discuss their negotiating position with the relevant parliamentary committee before leaving, rather than just telling them about it afterwards.

Procedurally, to turn the "orange card" or "yellow card" into a “red card” would normally require a treaty amendment (to the protocol on subsidiarity, which has treaty status). However, the same result could be achieved if the commission were simply to undertake to withdraw any proposal in the event of an orange (or perhaps even yellow) card being triggered by national parliaments. This should not be a major sacrifice for the commission – after all, if so many national parliaments oppose a proposal, it is anyway unlikely to get through the council.

A suggestion taken up by the House of Lords is to allow national parliaments to make suggestions to the commission for new European proposals, called a "green card procedure". This too would simply require a commission undertaking to examine any such suggestions sympathetically.

Protection for non-eurozone members

The government has long argued that the eurozone needs further integration and that it might become a hard core within the EU, marginalising non-euro countries.

In fact, although the countries that share a common currency do need to do more together to manage that situation, the bulk of what the EU does remains at the level of the whole union: the single market and the legislation that sets the common rules for that market (on competition policy, consumer protection, environmental standards, some workplace rights, etc), research and development programmes, foreign policy, trade, police and justice cooperation, the Erasmus student exchange programme, agriculture, fisheries and so on. Britain will only be on the margins if it marginalises itself.

The area where there is arguably a danger that the eurozone might act as a cohesive caucus within the wider EU is in the field of financial sector regulation. But in this area, the EU has already agreed to have a “double majority” rule, where a majority of both members and non-members of the eurozone is required to agree any new rules. This was done through ordinary legislation, without needing a treaty change, when the rules for the European Banking Authority (EBA) were laid down.

Migration and freedom of movement

This issue did not feature in Cameron's Bloomberg speech. Since last year, under pressure from the United Kingdom Independence party and the Tory right wing, he has made it his key issue.

Most migrants in Britain are from outside the EU – entirely a matter for national regulation and nothing to do with the EU. Within the EU, there almost as many Britons in other member states as there are other Europeans in Britain. Those here pay one-third more in taxes than they take out in benefits and services together. And in terms of eligibility for benefits, let us recall that under current law, an EU migrants arriving in Britain have no immediate right to claim unemployment benefits and must be coming for a job or able to support themselves without being a burden on the exchequer. If they are coming simply to claim benefits, the European court has just confirmed that they are not entitled to receive them. So this is not as big a problem as it is made out to be in terms of numbers or in terms of cost to the exchequer.

The problems that do arise are very often of a different nature – and could be dealt with domestically by dealing with agencies that only advertise abroad and not locally, using the surplus the Treasury gains from migrants to help local authorities with extra needs resulting from migration, requiring an appropriate level of English language proficiency for certain jobs, enforcing the minimum wage, and suchlike.

Cameron’s main proposal in this area is to change tax credits and child benefits for employed (and therefore tax-paying) EU migrants. This would save the exchequer about 0.3 per cent of public expenditure – but risks much greater amounts if his strategy fails.

It is an area most fraught with difficulty and complexity.

Directive 2004/38 (on free movement of citizens) is the key piece of legislation in this field. It provides the following entitlements:

● EU citizens can reside in another member state for up to three months without any conditions except the requirement to hold a valid passport or identity card (Article 6).
● A host member state is not obliged to confer entitlement to social assistance during the first three months of residence or any longer period during which a migrant is genuinely seeking work, nor will it be obliged, prior to acquisition of the right of permanent residence (granted generally after five years – Article 16(1)), to grant maintenance aid (Article 24(2)).
● Persons exercising their right of residence should not become an unreasonable burden on the social assistance system of the host member state during an initial period of residence (Recital 10).
● It is for the host member state to decide whether it will grant social assistance during the first three months of residence, or for a longer period in the case of jobseekers, to EU citizens other than those who are workers or self-employed persons or who retain that status or their family members, or maintenance assistance for studies, prior to the acquisition of a right of permanent residence (Recital 21).
● All EU citizens shall have the right of residence in another member state for longer than three months if they:
○ are workers or self-employed persons in the host member state; or              
○ have sufficient resources for themselves and their family members not to become a burden on the social assistance system of the host member state and have comprehensive sickness insurance cover (Article 7(1)).
● EU citizens may not be expelled if they are workers or self-employed persons; or if they entered the member state to seek employment, for so long as they can provide evidence that they are continuing to seek employment and that they have a genuine chance of being engaged (Article 14(4)).
● All EU citizens and their families shall enjoy equal treatment with the nationals of the host member state (Article 24(1)).

Regulation 883/2004 (on the co-ordination of social security systems) provides that migrants from other member states shall enjoy the same benefits and be subject to the same obligations under the legislation of any member state as that state’s nationals (see Article 4). This right extends to special non-contributory cash benefits. Further, in conferring benefits host states are to take into account periods of events (e.g. employment, contributions etc.) in the national’s home state (see Article 6).

Cameron's demands in this field will require modification of (or exemption from) this legislation. Even if then, the treaty principles of non-discrimination on ground of nationality and freedom of movement apply.  Changing legislation requires the approval of a qualified majority in the council and a majority in the European parliament. Changing the treaty requires unanimous agreement of all member states and national ratification.

An alternative could be to modify the UK system to introduce a qualifying period before benefits can be claimed. This would have to be in a non-discriminatory way, eg a requirement to have been resident for two/three/four years, applying to British citizens too.

Transitional controls

The idea here is that future accessions to the EU should be subject to longer transitional periods before freedom of movement applies. As this issue is negotiated in accession treaties, which have to be unanimously agreed and ratified, there should be no problem for any future UK government to insist on that. No accession is expected for the next four years (when the most likely candidate to be ready is Montenegro, with its population of 0.6 million).

The open goals of on-going reforms

In fact, the EU is a non-stop reform process. It is a constant renegotiation of existing policies and procedures. Most EU legislation nowadays is about revising, updating, adapting or repealing existing EU legislation.

Cameron could and should claim as a victory various recent or on-going reforms which Britain has supported, including:

● the (much needed) 2013 reform of the common fishing policy, which even Greenpeace hailed as very good. It is still subject to implementing measures being adopted.
● the 2014 settlement on the budget (the MFF - the Multiannual Financial Framework until 2020). Cameron is already claiming as a success that he cut the overall budget ceiling. More significant is the shift within the ceilings away from agriculture to R&D, transport links and other items where spending at EU level saves money at national level through economies of scale or avoiding duplication.
● the Refit programme, revisiting all existing EU legislation to simplify, adjust or repeal it, not least in order to lessen any unnecessary regulatory burdens.
● the negotiations that have just started on "better regulation":  this involves providing for systematic use of impact assessments and stakeholder consultations on legislative proposals as well as stronger provisions on evaluation of previous legislation to see if it has worked.

Richard Corbett MEP is Labour's spokesman on EU constitutional affairs in the European parliament and deputy leader of Labour's MEPs. He is an academic author on EU affairs

This is a contribution to Policy Network's work on The Future of the EU.

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Simon Morley
10 July 2015 14:00

Maybe Cyril Smith's problem was not what he did but what he didn't? Everything just seems so screwed up. War seems almost inevitable.

Simon Morley
10 July 2015 13:50

Can the European union do anything about the massive sexual abuse scam that is the English education system?

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The Policy Network Observatory promotes critical debate and reflection on progressive politics. It is centre-left orientated but determinedly challenges social democracy. It is pro-European but restlessly questions EU institutions and practices.

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