The bear went behind a tree in the woods. The Pope said the catechism. And the Europe issue exploded amidst the parliamentary Conservative Party. It was a big rebellion, tempers were frayed, two MPs resigned government positions and one MP fainted. But (and I hope you are seated comfortably) the Tory party is actually fare more united on Europe than it has ever been – on the ends. There is almost complete consensus that we want to repatriate powers, and we want a referendum. David Cameron, William Hague and Michael Gove have all said this, as have a whole raft of loyal backbenchers including Nick Boles. The split is on the means – the how and the when. Clearly, there is trust to be rebuilt (as Paul Goodman rightly pointed out), and bridges to be mended. But we shouldn’t underestimate how united the parliamentary party is in what it wants to achieve.
As one of the 84% of the population who has never had a say in Europe (and as a former Europe correspondent of the Times who has written books and pamphlets on Europe), I would love nothing more than having a referendum. I was deprived of one on the euro, and was deprived of one on the constitution (aka Lisbon Treaty), and I want my say. But it has to be the right referendum. We can’t just have a referendum for the sake of having a referendum, inexplicably coming out of nowhere. There has to be a reason for having it – a trigger, and a specific question asked, such as whether we should sign up to a new constitution or join the euro. We have to create the right narrative and momentum behind a referendum. A simple in-out referendum, imposed on the public, might well be lost, which would be as big a setback for Eurosceptics as the no to AV vote was to campaigners for electoral reform. We would in fact be repeating the mistakes the Lib Dems made in demanding their out-of-the-blue referendum on AV.
It is also far better for the government – or at least the Conservative part of it – if it is a referendum question that it could actually campaign for. For the government to instantly hold a referendum on leaving the EU and then campaign for a “no” vote (since staying in the EU is government policy) would be massively confusing to the public, and counterproductive. Indeed, it would be difficult to explain to the public outside the Westminster village why the government was holding a referendum and then campaigning for a result that would leave us with the status quo. Far better to get some changes that we want in our relationship with Europe (repatriation of powers etc), and then campaign for a “yes” vote. Alternatively, if we end up with treaty changes that aren’t acceptable being imposed on us by the rest of the EU, then the government (or the Conservative part of it) will have to hold a referendum and campaign for a no vote to kill off the changes. That might even be a trigger for an in-out referendum.
So where do we go from here? It is so difficult for Eurozone countries to agree fiscal reform, that the working assumption of the government is that there will be a whole series of small treaty changes, rather than a big-bang one. Some countries, such as Ireland (which would be bound by its constitution to hold a referendum) are opposed to treaty changes, but Germany wants them, and it pays the bills. We should use these treaty changes to demand changes in our relationship with Europe. The government wants two protections of our national economic interests – protection of the single market, and financial services. Despite the media speculation, the government will not at present push for repatriation of powers over social and employment legislation, as the coalition can’t get agreement on it (that’s Nick Clegg for you). On the single market, we need powers to stop the Eurozone 17, under the auspices of France and Germany, using qualified majority voting to impose protectionist anti-free trade policies on the rest of the EU, including the UK. We can’t let fiscal integration in the Eurozone lead to the undermining of free trade.
On financial services, we need recognition that we are different – we are the financial services capital of Europe, with market shares in excess of 75% in much of the sector. It is ludicrous that government ministers find themselves having to fight off a barrage of legislation being imposed on us by countries that wouldn’t know a derivative if you tried to sell them one. They are negotiating valiantly – often heroically – often overturning initial majorities of 26 to 1 against them. But they just shouldn’t be in this position to start with. Our difference to the rest of Europe in this sector should be recognised in the treaties. One option being actively considered is that the UK should have a unique veto on financial services legislation.
With the Eurozone having to reinvent itself to save the Euro, the Europe issue isn’t going to go away. And unlike with negotiations over the constitution and the Lisbon treaty, this time the Conservative party is in power – and united in what its aims are. We should not let disagreement on the means blind us to the fact that for Eurosceptics, these really are exciting times.