15 April 2015

Liberal Democrats

On the big question of the referendum, just like Labour, the party pledges to hold an in/out referendum only in the event of a transfer of powers from the UK to Brussels, even though as we’ve pointed out before, there are a number of question marks over such an approach.

The party also states that its support for continued membership “does not mean that  the institutions and policies of the European Union are perfect and do not need reform”. In terms of the substance of these reforms, there is significant overlap with the Labour and Tory manifestos, although in some areas the party provides much more detail. For example, rather than just pledging to cut EU administrative spending, the party proposes scrapping the (useless) European Economic and Social Committee which would save EU taxpayers over €100m per year, and rather than just pledging to cut red tape, they promise appointing an “EU Business Minister to lead this competitiveness agenda”.

Like both other main parties, the Lib Dems also pledge a red card for national parliaments give them “the automatic ability to block unwanted legislation” and to “prevent any perceived ‘right to claim’ by tightening benefit rules for EU migrants, including reducing, and ultimately abolishing, payment of Child Benefit to children who are not resident in the UK.” Interestingly however there is no explicit mention of safeguards for non-euro member states – those of a cynical disposition might question whether the party still holds out hope of the UK joining the Eurozone at some point in the future?

The compatibility of Lib Dem EU policy with that of the Conservatives is important as in the event of a second coalition. An EU referendum would simply have to be part of the agreement, and in his appearance on the Today programme this morning, David Laws refused to describe it as a “red line” for the party. Nick Clegg went even further, implying in an interview with the Guardian that the parties could conduct an EU renegotiation together:

“You cannot have a split-screen arrangement where something of such huge constitutional importance is dealt with only by one wing of the government and the other half of the government carries on blissfully un-involved.

Although there would still be sharp disagreements over several other key EU policy areas not to mention broader philosophical differences over Europe, the Tory and Liberal Democrat manifestos do contain enough common ground for the basis of a moderate EU reform agenda.

UKIP

The UKIP manifesto covers a broad range of issues but almost all of them are linked in some way to the wider EU question, and savings from no longer contributing to the EU budget have been earmarked for a range of crowd-pleasing electoral promises. Nigel Farage also confirmed that the party’s most important red line in any post-election deal would be a “full, free and fair” EU referendum.

Most significantly, the party has softened its demand for the referendum to be held immediately after the election, instead calling for it to be held “as soon as possible”. This softening implies that UKIP might be willing to support a later referendum. The party would of course argue for exit, and if successful, would trigger Article 50 which would give the UK and EU two years to agree a new relationship. UKIP cannot be accused of lacking ambition; the manifesto states: “as a minimum, we would seek continued access on free-trade terms to the EU’s single market”. As we pointed out in our recent Brexit report, maintaining the current level of market access outside of the EU (or EEA) will prove challenging and may well depend on retaining free movement (an absolute red line for UKIP) and continuing to make some contribution to the EU budget.

Since the party is unambiguously pro-exit it is hard to analyse its approach to specific EU policy areas but here are a couple of key points:

Immigration: As expected, UKIP pledges to abolish free movement and treat EU migrants the same as non-EU migrants (although existing EU migrants would be allowed to remain in the UK). The party would impose a five-year freeze on non-skilled migration and cap skilled migration at 50,000 per year. The party would also impose much tougher rules on migrants’ access to benefits and social services, but outside of the EU there would be less legal obstacles to doing so.

TTIP: UKIP complains that “TTIP may compel us to put many of our public services up for sale to US companies, thereby privatising significant parts of our NHS. UKIP is committed to securing the exclusion of the NHS, by name, from TTIP.”

Agricultural Policy: Upon leaving the EU, UKIP pledge to “introduce a modified UK Single Farm Payment (SFP) scheme of £80 per acre for lowland farms, with comparable arrangements for lower grades of land, capped at £120,000.” This means the central element of the EU’s CAP – taxpayer subsidies to farmers – remaining in place at roughly their current level, although the party would exclude golf courses and other non-productive areas. The party does not commit to reducing tariffs on food, something which would upset UK farmers but hugely benefit consumers via lower food prices.

The UKIP manifesto talks up opening up to free trade and cutting red tape but there is little detail, particularly on the first point. As our Brexit report noted, in order to make leaving the EU an economic success, the UK would have to vigorously pursue both and make choices that are likely to be unpopular with many voters, including those UKIP is actively courting.