EU Referendum Update

As we near the end of the UK Parliamentary Session, European Policy Solutions will give a brief update on the progress of the EU Referendum  in the UK.

Progress in the United Kingdom Parliament

The Referendum Bill has completed its Committee Stage which entailed two days of debate.  It will now have a Third Reading after the Summer Recess and then go to the House of Lords.

The European Union Referendum Bill was published on 3 June 2015 and the question to be asked is ‘Should the United Kingdom remain a Member of the European Union.’  The question has also been translated into Welsh in the Bill.   A number of political commentators and politicians see the question as a positive one which in its phrasing, favours the ‘Yes’ campaign.  The referendum must take place before 31 December 2017.   The major issues surround the role of the UK Government, ‘purdah’, funding of the campaigns and those eligible to vote.  ‘Purdah’ is a political convention which does not allow Government Ministers to make  policy announcements which could influence an Election, or in this case, the Referendum. The two day debate at the Committee Stage did little to change the draft Bill but these issues will be the major areas for discussion when the Bill is discussed further in the autumn.

The electorate , or those able to vote, will remain the same  as the General Election with no EU citizens able to exercise their franchise unless they are Irish, Maltese or Cypriot citizens resident in the UK.  A number of politicians wanted the electorate extended to EU citizens in the UK and extended to 16 and 17 year olds.  The Bill also states that the Government does not need to enter ‘purdah’ for 28 days before the election.   The Labour Party now support the Referendum but the Scottish National Party (SNP) oppose it.  This gives the Government a large majority and moves the debate onto the details such as those eligible to vote.

In June 2015,  the tensions in the Conservative Government began to show with the formation of ‘Conservatives for Britain.’ A strange title as you would think that all Conservatives were for Britain anyway. This is a Group of over 50 Conservative MPs and  the Chair is Steve Baker MP.  According to his website, Conservatives for Britain ‘consider the UK’s present relationship with the EU to be untenable.’  While they support the ‘(Conservative) Party’s policy of renegotiation and referendum’, they ‘will discuss how to prepare a possible “out” campaign, to be activated if it is apparent that negotiations will achieve the objectives.’

UK Business and the EU Referendum

A Business Group, Business for Britain, has produced a 1,000 page report which concludes that the UK should leave the European Union. However, they have added a caveat that if Cameron can achieve substantial change and push Europe to a two-tier model, then the UK could stay in.   Given the  changes that Business for Britain have outlined, it is unlikely that they will be satisfied by the UK Government’s negotiations.

However, most large companies are in favour of the UK staying in the European Union.  Earlier this month, a survey of the top FTSE 350 companies was carried out by the  Institute for Chartered Secretaries (ICSA).  Of the companies that responded , 63%  said that a British exit from the EU was ‘potentially damaging’ to their company while only 3% saw it as a ‘positive development’ for their company.  Reporting on the survey, The Guardian, said that the ICSA report ‘echoed other recent surveys suggesting that uncertainty around EU membership and the Government’s position was curbing investment and expansion plans.’  According to The Guardian,  the Confederation of British Industry (CBI) has drawn criticism from the UK Government’s Business Secretary, Sajid Javid, for its ‘high profile campaign  to see Britain remain in the EU.’

Activity in the EU

David Cameron has now visited all other EU capitals to speak to EU Leaders and he also spoke to the European Council in Brussels at the end of June 2015. Due to the economic crisis in Greece and the migration crisis in Southern Europe, EU Leaders had more pressing matters to deal with than the UK Referendum.  At the Press Conference following the Council, the UK Prime Minister outlined the four areas he wanted to see reform – sovereignty; fairness; competitiveness and immigration.

In terms of sovereignty, Cameron felt that the EU ‘interferes too much.’  He said that the UK does not want to be part of an ever closer Union ‘to be dragged into a state called Europe.’    On the subject of fairness, he did not want to see  countries disadvantaged by developments in the Eurozone and that the Single  Market must work for all.   On the migration issue, Cameron highlighted welfare benefits for migrants while on making the EU more competitive, he echoed the Europe 2020 Strategy and that the EU should be a source of jobs, growth and innovation.

In concluding his remarks, Cameron stated that the UK  ‘membership of the EU will once again have the common market at its heart.’ This Back to the Future comment echoes Eurosceptics who never tire of saying that the UK voted for a Common Market in 1975 and not a European Union.  It smacks of bygone arguments between a European Economic Community and a  European Free Trade Association (EFTA) – an argument lost by supporters of EFTA as most of their members joined the European Community.

The European Commission has been gearing up for the renegotiation and has created a Task Force to deal with the ‘reforms’ suggested by the UK Government.  The Task Force is to be headed by Jonathan Faull who has thirty years of experience working in the European Commission and has had a number of senior posts.

The EU Referendum still has to hit the headlines both in the UK and in Brussels but this may change as we head into the autumn.  However, the UK Referendum may still be crowded out by Eurozone issues and President Hollande comments in a recent French newspaper seems completely opposed to the Cameron view.  He commented that the Greek crisis shows that ‘what threatens us is not an excess of Europe but its insufficiency.’