David Cameron has just come back from a mini-summit of Nordic countries in Iceland where — and don’t ask me why — the leaders were presented with some Lego bricks and challenged to turn them into a duck. The prime minister of Denmark excelled at this task. Perhaps he had an unfair advantage. The British contestant struggled. The Icelandic prime minister, the splendidly named Sigmundur Gunnlaugsson, ungallantly revealed that Cameron’s effort “looked more like a dog”. The cheap crack to make — so make it I will — is that if the prime minister makes a dog’s dinner of trying to turn a handful of plastic bricks into something resembling a duck, how is he going to make a success of his attempt to keep Britain inside the European Union on renegotiated terms?
That involves constructing a deal acceptable to the 27 other members of the EU, managing the volcanic passions of the Conservative party and winning the battle for public opinion when it comes to selling continued membership in the referendum he is pledged to call before the end of 2017. That’s a lot of moving parts.
The renegotiation process is about to get a whole lot grittier. Things have been in stasis while Europe was preoccupied with the refugee crisis and Cameron’s government was embroiled in its domestic struggles. Progress was also stalled until the Poles got their election behind them. Now, in the estimation of one very senior member of the cabinet: “It’s about to really hot up.”
One sign of that is the prime minister raising the temperature of his language about the great question. He showed a bit of leg — and offered some encouragement to pro-Europeans — when he attacked the Outers last week. He pointed to the “significant downsides” of self-ejection and scoffed at the notion that there is a “land of milk and honey” option for Britain in which we would continue to enjoy all the benefits of being part of the EU from outside it. For the first time, he addressed the alternatives to membership and in doing so he dissed them. He cited the example of Norway, often hailed by Outers as a template for how a country can prosper outside the EU. The prime minister rightly pointed out that the Norwegians have to conform to most EU regulations and also pay a hefty subscription in order to access the single market. Yet the Norwegian government is excluded from the room when the rules of the EU are made. They pay, but they get no say. Norway is also compelled to allow freedom of movement. In fact, it has proportionally twice as many EU migrant workers as the United Kingdom.
For those who follow these things closely, the argument about Norway was not novel. The new and significant thing is that it was Cameron making that argument and by doing so directly taking on the Outers in a way he has not done before. Number 10 has also become very active in attacking the Outers in other ways by squelching the notion that there could be two referendums, an idea reportedly flirted with by Boris Johnson.
It had been a fear among pro-Europeans that the prime minister would not campaign enthusiastically for an In vote or he would leave it late to start making the case for continued membership. As I reported to you last month, there was a period when some at Number 10 were even pressing the notion that he ought to present whatever he manages to renegotiate on a “take it or leave it” basis. Cameron and his inner circle now seem to grasp that he is going to have to start taking on the Outers himself and he can’t let them make all the running in the many months between here and the moment of national decision.
That still leaves him in the rather tortuous position of maintaining that he might join the Out camp if his renegotiation fails. This is because he is imprisoned in a catch-22. European leaders have been telling him that they are reluctant to seriously engage with his renegotiation until he gives them some guarantees that he will campaign for the UK to stay in. Why, in their view, should they put themselves through a great deal of bother if Britain is going to flounce out at the end anyway?
His problem is this. As soon as he drops all his veils and makes it explicit that he will recommend continued membership to the British people, his critics will come back that he has reduced the incentive for the rest of the EU to be amenable to his demands and the Outers will cry even louder that the whole thing is a sham.
The prime minister has also been reluctant to detail exactly what he hopes to achieve on the grounds, as one ally puts it, that “no sensible poker player shows everyone his hand”. That left other European leaders complaining that the British government wouldn’t even put anything down on paper. Well, shortly they are going to get a piece of paper, another signal that things are about to “hot up”. Number 10 is drafting a letter in Cameron’s name to Donald Tusk, the president of the European Council. It is due to be posted to Brussels this week and will finally put in writing what he is seeking to achieve.
We do not really need to see the letter to already have a fair idea of what he is after. We just have to reread the various speeches he has made and articles he has published — “the founding texts” as one official wryly calls them — since he first committed himself to this course. We can also make a reasonably good stab at assessing how far this enterprise is likely to get.
He wants a formal recognition that the European Union is a “multi-currency” area — not one, as the treaties currently assume, in which all members are inside the euro or on a trajectory to joining it. He wants safeguards for the countries not inside the Eurozone, mechanisms that some officials call “an emergency brake” and others refer to as a “traffic light system”, to prevent Eurozone countries making decisions that jeopardise the economic interests of the minority outside it. For the Treasury, this is by far the highest priority of the renegotiation. George Osborne will focus more attention on it and give more detail about what Britain wants when he makes an important speech in Berlin on Tuesday to Germany’s equivalent of the CBI.
Cameron further wants a recognition that all countries are not bound to a commitment to “ever closer union”, as the treaties have it.
I think the prime minister thinks he is going to get something on the latter. The main reason I say that is because of what he said to his party conference three weeks ago. In a speech otherwise opaque about his aims, he made specific mention of “ever closer union”. He would not have done so if he did not reckon he was going to get some sort of success in that area. Ultimately, that is about linguistics and one thing the EU is good at is coming up with forms of words to keep everyone happy.
Things will be much crunchier when it comes to decision-making in the EU, especially about money. That part of the renegotiation is going to be long and complex, particularly around the issue of how the non-members of the Eurozone are protected from decisions made by the majority who are in the euro. At the moment this problem, and the rows it triggers, is being addressed on an ad hoc basis, as with the clash this summer when the Eurozone members tried to get the non-members to stump up for part of the cost of a bailout.
Ministers and officials close to the process say that “our problem is understood” by the French and the Germans. They also think that there is already the basis for a bargain. The euro countries need deeper fiscal and monetary integration to stop the zone being so dysfunctional and prone to crisis. That requires treaty change. Treaty change requires the consent of all EU members. The basic deal to be proposed by Britain is that the non-euro members will allow the euro members to have their integration in return for fortified protections for countries outside the currency.
One senior cabinet minister predicts: “The essential trade is there to be done to the mutual benefit of us and them.”
The area that looks most challenging for Cameron is freedom of movement and the rights to benefits of migrant workers. One minister closely involved with the process characterises this part of the renegotiation as “extremely difficult”.
In the past, and more than once, Cameron has publicly demanded that EU migrant workers should not be able to claim in-work benefits within four years of arriving in the UK. That is particularly unpopular with his counterparts in eastern Europe. Number 10 has not formally retreated from that position, but I detect a softening of it. Advisers to the prime minister now talk in vaguer terms about “reducing the pull factors”, which suggests to me that they already know they are not going to get the four years.
This much is already very clear. It will make building a Lego duck look like child’s play.
— Guardian News & Media Ltd
