The
EU and David Cameron: We need to talk about Brexit
What
you need to know as the real debate begins on Britain’s EU
membership.
By TARA PALMERI
2/1/16, 5:30 AM CET
Three months’
worth of talks between David Cameron, his fellow European leaders and
the heads of EU institutions in Brussels will finally become words on
paper this week, setting the stage for a dramatic summit aimed at
keeping the U.K. in the Union.
Cameron’s shuttle
diplomacy on reforms he wants to see before Britons vote on their EU
membership has been going on even longer than that. The British prime
minister has been traveling the continent since his re-election in
May — first to sound-out other countries on their appetite for
change, and then sell them on several demands he laid out in a letter
in November.
The campaign has
intensified in the last few days, as Cameron has been under the gun
to convince the European Commission to include his most contentious
demand — a four-year ban on in-work benefits for EU migrants — in
a draft agreement to be considered by national leaders meeting later
this month.
Cameron wants to
move quickly now and hold the referendum in June. That has made it
essential for all 28 EU countries to agree at their February summit
to his reforms on everything from boosting competitiveness to
ensuring national sovereignty.
The longer countries
bicker over the proposed changes, the reasoning goes, the stronger
opposition in Britain will grow to EU membership, increasing the
chances the electorate will vote to leave the Union.
Throughout the
process, many EU politicians have complained about having to deal
with what they say is a domestic issue that Cameron has thrown onto
Europe’s shoulders while they also grapple with bigger problems
like the refugee crisis and financial instability in Greece.
As the debate enters
its endgame, here’s a look at the key questions that have brought
Britain’s EU membership to the brink:
Why is there even a
referendum?
Cameron promised in
2013 to give the British people a chance to decide on EU membership,
after he negotiated reforms that would make the EU a better deal for
the U.K. He then made following through on that pledge a central part
of his successful 2015 re-election campaign.
The public debate in
Britain since then has covered everything from whether the U.K.
supports the goal enshrined in the EU treaties of an “ever-closer
Union” to whether the bloc’s guarantees of the free movement of
people and labor are overwhelming the British welfare system — an
argument that has proven valuable to Euroskeptic, populist
politicians whose support in recent elections has grown.
“At the moment
people can come here and get instant access to our in-work benefits
system which is worth many thousands of pounds to people,” Cameron
said on Friday after meetings with Commission President Jean-Claude
Juncker and Parliament President Martin Schulz. “It goes to a
deeper issue which is the British people, and I, want a system where
you have to pay in before you get out. We don’t want a
something-for-nothing society.”
British Euroskeptics
— led by United Kingdom Independence Party leader Nigel Farage —
blame the EU for regulatory red-tape that hinders the country’s
competitiveness in the global marketplace and argue that Britain
would be stronger outside of the bloc.
Cameron has had to
make the case for EU membership while sending the message to voters
that he is still standing up for British interests in Europe. Last
week he sounded almost like a UKIP member when he told the BBC he’s
“very suspicious of Brussels.”
The prime minister
cannot even count on the support of members of his own party, as
tension between the Ins and the Outs has divided British
conservatives and even Cameron’s own cabinet.
The electorate
wavers on the issue, with recent headlines on the EU’s econonic
woes and its inability to deal with the refugee crisis giving
momentum to the Out forces. However, a Daily Mail poll released this
weekend showed a surge in support for the In side, with 54 percent
saying they would vote to stay in the EU and 36 percent saying they
would vote to leave.
What’s at stake?
Britain is the
second largest economy in Europe, and its departure from the EU would
have a serious economic impacts on the Union — everything from
weakening its status as a global trading partner to reducing the
bloc’s budget.
More importantly, a
Brexit would also be a huge political and psychological blow to the
EU, with one of the bloc’s most important members deciding to leave
at a time when it is besieged by other problems, including the
migration crisis.
The consequences for
Britain would be no less serious, according to “In” supporters.
Even the Euroskeptic think tank Open Europe recently estimated that
the U.K. would lose 2.2 percent of its GDP by 2030 if it leaves the
EU single market.
Many foreign banks
with offices in London have said they would consider relocating if
Britain leaves the EU, which would result in job losses and
logistical complications.
The U.K. would also
have to work out its own new trade agreements with other countries if
it leaves the Union. The U.S., which has long argued against a
Brexit, has already warned that it is not interested in negotiating a
separate trade deal with the U.K.
There would also be
domestic political fallout for Cameron, who has all but staked his
premiership on the outcome of the vote. And a Brexit would like
re-awaken the Scottish drive for independence, as leaders there have
said they would call for another referendum on the matter as a way to
remain in the EU.
What does Cameron
want?
The British prime
minister insists that the EU needs to change the way it does business
if the U.K. is to remain in the bloc. He has grouped his demands for
EU reform into four baskets:
Competitiveness:
Cameron wants the European Commission to follow through on its
promise to cut red tape and eliminate “unnecessary legislation”
by focusing on measures that promote economic growth. Initiatives
such as the digital single market, the capital markets union and a
sweeping EU-U.S. trade deal are already in Juncker’s agenda so they
won’t be points of contention in the reform package presented to EU
leaders. At home, Cameron has already been selling them as promising
steps toward British goals on competitiveness.
Sovereignty: Cameron
wants measures to strengthen the role of national parliaments in the
EU legislative process, and wants a guarantee that the Lisbon Treaty
phrase “ever closer union” is not applicable to the British.
Euroskeptics have interpreted the “ever closer union” language in
the treaty — which the U.K. agreed to when it joined the Union and
upheld in a referendum in 1975 — to mean that the ultimate goal of
the EU is a federal United States of Europe, of which they want no
part.
Economic governance:
Protecting London’s financial hub — the City — from decisions
made by the bloc of countries using the euro currency has been a top
priority for the U.K.’s Chancellor of the Exchequer George Osborne.
Cameron wants a set of legally binding principles that protect
non-euro countries like the U.K. from decisions made by euro “Ins.”
Immigration:
Cameron’s fourth basket, on reducing the flow of workers from other
EU countries to the U.K., has long been the most contentious of the
Brexit issues. In his letter to EU leaders in November, Cameron
sought a four-year ban on in-work benefits and social housing for EU
migrants and an end to the practice of sending child benefits to
other countries. Haggling over the demand has continued up until the
last minute, and is likely to consume much of the summit debate later
this month.
Where does the rest
of Europe stand?
Eastern Europe: Many
EU leaders, especially those from Eastern Europe, have argued that
banning benefits for non-U.K. citizens is discriminatory and
infringes against the basic freedom of movement — a founding
principle of the EU. Members of the Visegrad Group of countries —
Czech Republic, Hungary, Poland and Slovakia — will meet ahead of
the summit to coordinate their line on Brexit. Poland has been
especially critical of the demand, saying it would unfairly punish
Polish workers even though they are EU citizens and calling it a “red
line” issue. That sets the stage for a tough negotiation at the
summit.
France: Wary of
allowing the U.K. or other non-eurozone countries to have a say in
decisions made by eurozone members, France sees the economic
governance demand as the most troubling. “Politically it will be
immediately taken that the U.K. wants to remain in the EU to block
the euro,” said a French official involved in the negotiations.
“While Cameron says we want to have a safeguard, the euro is the
strongest asset in Europe.” Paris is also concerned about how
opposition parties like Marine Le Pen’s National Front will play
the idea of the U.K. having too much of a say in French fiscal
affairs. “The National Front already says that the U.K. will tell
us what we want to do in the euro,” the official said. “If they
know an EU country has a way to block our destiny, that’s not
right.”
Germany: Chancellor
Angela Merkel will be Cameron’s strongest ally in making the case
to other countries that they should agree to reforms to keep the
British in the EU. Gearing up for its role as a “compromise
broker,” Germany formed its own Berlin-based task force to
troubleshoot reforms even before Cameron delivered his demands to EU
leaders. Merkel has been adamant about finding ways to accommodate
British reform demands without re-opening treaty negotiations.
Germany sees the U.K. as a pro-business, pro-free-trade ally in
Europe, and a counterweight to France. But many have warned that
although Berlin will argue to keep the U.K. in the EU, it will not
bend over backwards for the Brits. “Germany wants to keep them in
the European Union, under the conditions of the EU, and not at any
expense,” said German MEP Elmar Brok, chairman of the assembly’s
foreign affairs committee. “Germany is only part of the game. There
are 28 countries. They should not believe that Germany will give up
the European beliefs and principles.”
Quick fixes
“Ever closer
union”: Dealing with the phrase is being seen as merely “a
drafting matter” by officials involved in the negotiations that can
be fixed with an interpretation of the treaty that states the phrase
isn’t a binding, legal requirement for further integration.
The color system: To
boost the power of national parliaments a provision within the
existing Lisbon Treaty that already gives legislatures a “yellow
card” to ask the Commission and European Parliament to halt and
review legislation would be strengthened to include three levels of
cards that the EU institutions must acknowledge. A green card would
give national parliaments the power to propose legislation; a yellow
card would give them the power to ask for amendments; and a red card
would halt discussions altogether. The proposed threshold for the
percentage of national delegates necessary to wave a card was still
being discussed by diplomats last week.
Euro outs: To ensure
that eurozone “outs” aren’t affected by decisions of the “ins,”
the draft text will spell out various principles protecting the
rights of non-eurozone members. The safety mechanism Cameron wants
was being negotiated over the weekend, with a possible proposal to
give the U.K. and other non-euro countries the ability to call an EU
summit over specific eurozone issues, an EU diplomat involved in the
talks said.
Sticking points
The benefits ban: A
blanket four-year ban on in-work benefits for EU migrants, as
initially requested by Cameron, has been deemed incompatible with the
treaties and the concept of freedom of movement within the single
market, according to an EU diplomat involved in the negotiations. So
in an effort to find a solution without changing the treaties, the
Commission proposed an “emergency brake” mechanism that would
activate the four-year ban if the U.K. could prove its public
services were under strain because of an influx of migrants. Cameron
has been adamant that the four-year ban be written into the text
before the political debate begins on February 18.
Brake point: When an
“emergency brake” was first presented as a solution, it was
pitched as a mechanism to ban EU migrants from settling in the U.K.,
but has since been spun into an “indirect measure” that would
remove the incentives for migrants to move to the U.K. The brake
would technically be available to all member countries but has been
crafted for the British so that it would be applicable immediately
after the referendum, according to an EU diplomat close to the
negotiations.
What’s next
Cameron wants to
hold the referendum in June. In order to do that he needs to reach an
agreement on his demands by either the February or March EU summits.
“What we got from
the December Council is that Cameron wants us to go as fast as
possible and it’s in the interest of the Union to do that,” said
an EU diplomat involved in the negotiations. “If they want to meet
a February deadline it’s important to have a strong text.”
“Cameron is
holding onto his four-year solution,” said another EU official.
“He’s holding his cards until the last minute. The real
compromise will be in the middle of the night at the Council. He
needs to get the four-year ban on paper, then it needs to be seen how
it will be accommodated every which way.”
Cameron met with
Juncker on Friday to finesse the migration ban and continued to work
throughout the weekend with the Commission to make the solution as
strong as possible. He also met with Parliament President Martin
Schulz on Friday. Cameron and Tusk had dinner on Sunday to put the
final touches on the proposal which was due for distribution on
Monday, but they said they would need an extra 24 hours to fix some
remaining issues.
Schulz has invited
Cameron to return to the Parliament on February 16, two days before
the summit, to make his case to the political leaders of the groups.
And the British prime minister will attend a dinner in Hamburg with
German Chancellor Angela Merkel on February 12.
In other words,
Cameron’s EU reform sales pitch is far from over, and in some ways
it is just beginning as the proposals take shape and become real
political targets.
Authors:
Tara Palmeri
Tusk
says ‘no deal yet’ after Brexit dinner with Cameron
European
Council president and U.K. prime minister want to consult Berlin and
Paris on renegotiation.
By TARA PALMERI
1/31/16, 10:08 PM CET Updated 1/31/16, 11:07 PM CET
David Cameron and
European Council President Donald Tusk failed to clinch a deal at
dinner on Sunday on the U.K. prime minister’s demands for
renegotiated membership of the EU, postponing the release of a draft
text for another 24 hours.
Tusk, who had hoped
to present the proposals to the other 27 EU countries on Monday,
ahead of a “Brexit” summit on February 18, left the dinner in
Downing Street after two hours telling reporters: “No deal.” He
then tweeted: “No deal yet. Intensive work in next 24 [hours]
crucial.”
Shortly afterwards,
Cameron tweeted: “Good meeting with @eucopresident, who has agreed
to another 24 hours of talks before publishing the draft U.K.
renegotiation text.”
A diplomat involved
in the negotiations said they decided to try to fix the remaining
issues on Monday after consulting French President François Hollande
and German Chancellor Angela Merkel on details regarding welfare in
the U.K. for EU migrants.
“Tusk wants to see
where the member states are,” said the diplomat, speaking on
condition of anonymity.
It was not
immediately clear what was holding up progress, but Cameron had been
expected to press Tusk at the meeting to restrict benefits for EU
migrants to the U.K. for the next seven years, according to officials
involved in the negotiations.
That would mean
every EU migrant arriving in Britain at any time over the next seven
years would need to wait four years to receive government benefits,
the officials said.
The proposal is an
ambitious request as time runs out on the negotiations. The main
sticking point has been Cameron’s request to place a four-year ban
on in-work benefits for EU migrants.
The European
Commission has offered to create an “emergency brake” that would
activate the ban when a country could prove that its public services
have been overwhelmed. Cameron has argued that the brake should be
activated immediately after the U.K. referendum and for a substantial
period of time.
“On welfare, the
Commission have tabled a text making clear that the U.K.’s current
circumstances meet the criteria for triggering the emergency brake,”
said a Downing Street spokesperson on Sunday night. “This is a
significant breakthrough, meaning the prime minister can deliver on
his commitment to restrict in work benefits to EU migrants for four
years.”
Cameron wants the
final draft proposal to state that the brake would remain in effect
for seven years.
A senior U.K.
government source said earlier on Sunday that the prime minister
would tell Tusk the ‘brake’ proposal, as it has been sketched out
so far, “does not go far enough and will need to be significantly
strengthened if it is to be as powerful as the prime minister’s
four-year proposal.”
“He will also
argue that it should only be a stop gap to a more permanent
mechanism,” said the source, adding that Cameron would demand
“greater ambition” across the board.
The seven-year
emergency brake is a political statement for Cameron. He plans to
sell it as a way to make up for the period of time when former Labour
Prime Minister Tony Blair allowed the free flow of Eastern European
migrants to the U.K. after the EU expansion in 2004.
When Poland,
Hungary, Czech Republic and Slovakia joined the EU, existing EU
countries had the option to restrict these workers from entering
their labor markets for seven years. Germany, France and Italy upheld
certain restrictions for these nationals, but the U.K. opened its
markets immediately.
Tusk had tweeted
Sunday afternoon before the talks that he would present “solutions”
to Cameron, but added: “Agreement must be acceptable for whole
EU28. No compromise on fundamental freedoms.”
Authors:
Tara Palmeri
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