Andrea Leadsom is the Member of Parliament for South Northamptonshire.
This time last week, Westminster was abuzz with the impending visit of Chancellor Merkel. Would the chief power-broker of the EU help David Cameron and his reform strategy, or would she dash all hopes of significant reform?
She was fully aware of expectations and wisely set out to dampen hopes of either extreme. Early on in her speech to both Houses of Parliament, she said in perfect English “some expect my speech to pave the way for a fundamental reform of the European architecture which will satisfy all kinds of alleged or actual British wishes. I am afraid they are in for a disappointment.” She went on to say ”I have also heard that others are expecting the exact opposite and are hoping that I will deliver the clear and simple message here in London that the rest of Europe is not prepared to pay almost any price to keep Britain in the European Union. I am afraid these hopes will be dashed, too.”
While she offered little in the way of concrete proposals for reform, Chancellor Merkel gave great hope to those, like me, that are seeking to change the EU to improve its competitiveness and flexibility. She explicitly acknowledged the need for change, and the need for the EU to be outward looking. She stated that “Despite Europe’s 25 per cent share of global economic output, the World Trade Organization estimates that over the next five years 90 per cent of growth will be generated outside Europe. So to keep the European promise of prosperity in future, it will be vital to benefit from growth opportunities in other parts of the world.”
She was clear about the need to focus on economic competitiveness: “All member states of the European Union should ensure that all their European policies – whether energy and climate policy, the shaping of the single market or the management of external trade relations – be measured in terms of whether or not they help enhance Europe’s economic strength.” This is not far away from the proposal of the Fresh Start Project, which I co-founded in Sept 2011, that there is a ‘legal safeguard for the single market’—that all EU regulations must be deemed to strengthen the single market.
Chancellor Merkel went on to suggest ways to cut EU red tape stating that “we must continue to cut superfluous red tape at European level which is hampering our businesses…… European regulations – and national regulations too – must be reviewed regularly. If they are superfluous, they must be abolished.”
She went on to make the case for a better balance between regulation at the EU level and at the national level. “The European Commission must only regulate matters which cannot be adequately regulated by the member states themselves. More attention needs to be paid to the subsidiarity principle in Europe.” This adds considerable weight to the proposal of the Dutch government that the guiding principle of the EU should be ‘national where possible, Europe where necessary’.
Chancellor Merkel then lent her support to another idea of the Dutch, that member states clearly mandate the Commission. She said “the United Kingdom and Germany, together with our partners in Europe, should set priorities for the future Commission’s work.” Given that the next Commission will be established in November of this year, now is the time to put this proposal in place. It does not need to wait for any sort of treaty revision, and member states should be working up plans to focus the Commission on economic competitiveness. It should also have clear guidelines on those areas that the Commission should stay away from.
Away from the theme of economic competitiveness, Chancellor Merkel acknowledged the need to cope with some of the unintended consequences of EU legislation—for example benefits tourism. While stoutly defending freedom of movement she stated “Europe without borders is one of the great achievements of European integration. All the member states and all the citizens benefit from it. Be that as it may, if we are to preserve this freedom of movement and ensure that it is still accepted by the citizens, then we must also have the courage to acknowledge adverse developments and try to correct them.” In the press conference following lunch with the Prime Minister she expanded on this theme pointing out benefits tourism is as much of a concern in Germany as it is in the UK and that free movement could not involve unrestricted access to benefits.
She accepted that changes would be needed to the EU treaties “in a limited, swift and targeted way” to secure monetary union and the success of eurozone. She also offered the prospect of further changes—indeed she was crystal clear about the need for the EU to constantly change, quoting Winston Churchill: “To improve is to change, to be perfect is to change often.” She noted her personal experience of the collapse of the Berlin Wall “I learned first-hand: change – change for the better – is possible” and that “we need courage to bring about changes for the better just as much today as we did decades ago.”
In what could have been an almost direct rebuttal to those that say that changing the EU will not be possible, she stated “Of one thing I am convinced: if we clearly formulate the political will to make changes, we will also find the necessary legal avenues to attain our goals.”
She made a very clear pitch to the UK: “we need a strong United Kingdom with a strong voice inside the European Union. If we have that, we will be able to make the necessary changes to the benefit of all.” And she highlighted the close relationship between the UK and Germany stating that “There may be times when our ideas of the European Union’s future development differ in the detail. But we, Germany and the United Kingdom, share a common goal: a strong, competitive European Union which combines its efforts.”
However, in what may be disappointing to those who favour achieving revolutionary reform of the EU in one go, she quoted (for the third time) Richard von Weizsacker, the last German Chancellor to address the Houses of Parliament, “Europe will not move forward by leaps and bounds, but step by step.”
While Germany and Chancellor Merkel are clearly central to efforts to reform the EU, significant change must be agreed among all 28 member states. Those who say that change can’t be achieved often point to France as one of those who will resist far-reaching reforms so it was interesting to see former President Nicholas Sarkozy state in a speech in Berlin on Friday “, “The EU must give up the ambition to regulate and control everything. This was not the message of its founding fathers.” He also called for “more integration in the Europe of the euro, less integration for the European Union of the 28.”
Along with other MPs from the Fresh Start Project, I have been meeting MPs, ambassadors and leaders from other EU member states over the past couple of years to discuss the detailed proposals for reform that the Fresh Start Project has drawn up. It is clear that there is widespread and growing acceptance of the need for the EU to change, and significant support for the sort of reforms that we are proposing. The speech by Chancellor Merkel, and the comments of former President Sarkozy, show that at senior levels across the EU, the momentum toward reform is building. Clearly it will not be easy but, as Chancellor Merkel said following her meeting with David Cameron, “Where there’s a will there’s a way.”