13 April 2015

Main difference between Labour and Tories on the EU concerns strategy, not substance

The Europe section of Labour’s General Election manifesto contained no great surprises – all of the key points had already been set out previously. Nonetheless it provides a useful overview of the party’s EU policies – here are the most significant:

EU referendum: There will not be an in/out EU referendum under Labour unless there is also a treaty change proposing to transfer powers from the UK to the EU. As we pointed out when Miliband announced this policy last year, there are a lot of unanswered questions, including whether Labour would retain or repeal the existing treaty-specific referendum lock and what would happen in the event of a treaty that did not explicitly transfer any new powers to Brussels but that nonetheless had the potential to alter the UK-EU relationship.

Safeguards for non-euro EU members: The manifesto states that “We will not join the Euro, and we will ensure EU rules protect the interests of non-Euro members” which is a welcome commitment, although the party does not provide any further details.

EU migrant’s access to welfare:  The manifesto pledges to “secure reforms to immigration and social security rules, as well as pushing for stronger transitional controls [on new member states].” These plans, set out recently by Rachel Reeves, include a ban on exporting child benefit abroad and a commitment to “negotiate changes to benefits paid to people in work” which is less detailed and ambitious than Tory plans to impose a four-year qualification period for in-work benefits.

National parliaments: Labour are long-standing proponents of giving national parliaments greater powers to shape EU decision making and the manifesto re-states their commitment to a ‘red card’ mechanism for a number of national parliaments to club together to block new European Commission legislative proposals.

EU spending: The party promises to push for “tougher budget discipline” including reform of the Common Agricultural Policy and a review of EU agencies to reduce waste and inefficiency. The latter is a particularly welcome suggestion  – as we have shown, there are plenty of savings to be made by scrapping and slimming down the EU’s legion of quangos and agencies. Depending on how ambitious a Labour government would be, there are many further savings opportunities including around £4bn over seven years from limiting EU regional development funds to less wealthy member states, a proposal made by Open Europe supported by a number of Labour MPs.

As the list above demonstrates, once we get past the rhetoric, there is a substantial degree of cross-party consensus on the substance of EU reform. Clearly, there are also policy differences between Labour and the Tories, for example on social and employment laws (which Labour pledges to protect) and crime and policing laws (which are not mentioned at all).

There are also philosophical differences – Cameron has said he would like to end ‘ever closer union’ (even if he has not spelled out exactly what this means in practice), something Miliband or Labour have not done. Nonetheless, the single biggest difference is in terms of strategy; the Tories favour a tough and direct renegotiation backed up by a referendum while Labour favour a more piecemeal approach.

However, are Labour’s reform plans credible without a referendum?

When questioned about whether he could deliver any tangible reform without matching the Tories’ referendum pledge, Miliband replied that he would work with like-minded countries to pursue policies that would benefit the EU as a whole, citing rules around migrants’ access to benefits as an example where there is scope to strike an agreement, but one which risked being scuppered by Cameron’s “kamikaze” negotiating tactics.

However, while David Cameron’s pledge to hold an in/out referendum ‘by the end of 2017′ has its own risks, it does have the advantage of forcing reform onto the EU agenda. Even with an approach more attuned to other member states’ sensitivities Labour might struggle to deliver concrete results if it finds itself in office next month, especially since EU issues will not be that high up its list of priorities. Meanwhile, the refusal to put EU membership to the electorate is also likely to reduce the credibility of any successful reforms in the eyes of the British public, thereby diluting their political effectiveness. Both factors could actually make Brexit more likely further down the line, if and when there is a referendum.

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