Discussion: First, EU laws are made by the elected European Parliament and the Council of Ministers from elected EU governments. They are democratically made. Second, a House of Commons Library Research Paper: 2010 reported that 7-15% of legislation had a role in implementing EU regulations.
 
“In the UK, data suggest that from 1997 to 2009 6.8% of primary legislation (Statutes) and 14.1% of secondary legislation (Statutory Instruments) had a role in implementing EU obligations, although the degree of involvement varied from passing reference to explicit implementation. Estimates of the proportion of national laws based on EU laws in other EU Member States vary widely, ranging from around 6% to 84%.”
 
A House of Commons Library Blog more recently considered solely UK EU- based Statutory Instruments and EU Regulations and the proportion they form of all UK Statutory Instrument and concluded it is “impossible to achieve an accurate measure”:
 
All measurements have their problems and it is possible to justify any measure between 15% and 55% or thereabouts, depending on what is included in or excluded from the calculation. To exclude EU regulations from the calculation is likely to give an underestimate (see table on page 20 of research paper), while to include all EU regulations will probably give an overestimate (see table above).
 
The answer in numerical terms lies somewhere in between the two approaches, but the limitations of data make it impossible to achieve an accurate measure. We do not know, for example, how many regulations have direct application in the UK – olive and tobacco growing regulations are unlikely to have much impact here, but the UK implements such regulations along with olive and tobacco-growing Member States. The possibility of this happening increases as the EU expands to include more, and more diverse, Member States.”
 
There are Lies, Damned Lies, and Statistics! To add to the confusion the UK publishes around 15000 pages of legislation a year, of which 3000 pages are Acts of Parliament – not included in the statistics above.

» Show less...

The key results of the negotiation are:
 
– Britain now has the right – for seven years – to withhold benefits from new Immigrants from the EU if they would place ‘too much burden on the social services’. This will deter EU citizens without jobs from coming to Britain.

– Britain got a bankable statement that “the United Kingdom … is not committed to further political integration in the European Union … References to ever-closer union do not apply to the United Kingdom.”

– Any country not in the Eurozone like Britain, can show a ‘red flag’ to regulations proposed by those inside the Eurozone group that could disadvantage it. This red flag will trigger reconsideration by EU leaders. This protection will also be written into EU treaties, so Britain could use the European Court to challenge a final decision if it feels that it is discriminatory.

– Child benefits paid to EU immigrants children elsewhere in the EU will not rising automatically with UK benefits but be indexed to the standard of living in the country where the offspring are based.

» Show less...

Because the UK is not part of the Schengen agreement among some EU Member States it is not included in the agreement contained in the statement of the Heads of State or Government of the EU issued on 7 March to “accelerate the implementation of the visa liberalisation roadmap with all member states with a view to lifting the visa requirements of Turkish citizens at the latest by the end of June 2016”.
 
A government statement on 16 March 2016 confirmed this as follows: The UK Government cannot be obliged by the EU to lift visa requirements. Visa liberalisation for Turkish citizens as referred to in the Statement of 7 March is in respect of the Schengen area only. In accordance with the Schengen Protocol (No.19), the UK does not participate in the Schengen acquis concerning visas. The UK is free to request to participate in some or all of the provisions of the Schengen acquis which it does not already participate in, but is explicitly not obliged to do so. Nor is the UK bound by any Justice and Home Affairs measures in the area of EU visa policy unless the UK explicitly chooses to opt in, in accordance with the UK and Ireland’s JHA Protocol (No 21).”
 
Full EU membership for Turkey is not on the cards for many years, and may never happen. While Turkey is an important ally, trade partner and member of NATO, and the EU has agreed to re-energise the Turkish application for EU membership, there is a long way to go. A decision to allow a new member to join the EU has to be agreed unanimously by all 28 member states and the European Parliament too – and we know that some States, such as France, are strongly opposed to Turkish accession. It is more likely that some form of association short of membership would be found in the medium term. In addition, the UK has learnt from its action allowing Eastern European citizens in, earlier than did other EU states, and could insist on lengthy transitional periods were Turkey to join the EU.

» Show less...

Discussion: As anyone who bothers to read the all annual reports of the EU Court of Auditors will know, both of these statements are untrue. Yet they are widely used to condemn the EU. Opinion polls also find that people wildly overestimate the amounts of money involved, both the size of the Budget as a whole and that of the UK’s net contribution. For example, UKIP’s 2014 European Election manifesto stated that “the EU costs the UK Government £55m a day”, implying an annual payment of over £20 billion. The net figure was actually around £8.4 billion. The LEAVE Campaign claims that we send £350m a week to the EU. This has been widely condemned as false and ‘highly misleading’ because before any money is paid the Thatcher rebate (of nearly £100m) is deducted. This is reviewed every seven years in a process that gives the UK an effective veto over changes.
 
Since 2007 the Court has declared all the EU’s annual accounts ‘sound’. In addition, the defects that have been noted (‘material errors’ in about 4% of the accounts) are almost entirely the result of mistakes, not by the EU institutions, but by national administrations. As a result, it can indeed be argued that if the maligned Common Agricultural Policy, for example, were no longer to be funded out of the EU Budget, but were to be replaced by national systems of support (like the taxpayer-funded deficiency payments system that previously existed in the UK) the losses to EU taxpayers would not be reduced – in fact, would probably be larger.
 
In any case, granting the final “discharge” on the annual accounts is not the job of the Court, but of the European Parliament. In some years Parliament has withheld or postponed discharge in order to force reforms in the administration of the Budget – most notably in 1999, when the whole Commission was, as a result, forced to resign. Even budgetary scandals like that which brought this resignation are nevertheless insignificant when compared to the waste of billions by national governments on such projects as the British Health Service database (abandoned after expenditure of some £10 billion) or aborted defence procurement contracts.

» Show less...

Free movement within the Schengen area is under threat because of the refugee crisis, and while action is being taken to deal with this, it remains to be seen how well it will succeed. Interestingly, some estimates indicate that getting rid of Schengen would have substantial economic cost in terms of trade disruption.
 
“Immigration” combines a complex of separate issues. To begin with, the figures for net and gross immigration are often confused. Official figures are usually net (that is, immigrants less emigrants); and this is clearly the most relevant figure when discussing such issues as the overall housing shortage. In the year to June 2014, the net figure was 260,000, rising to nearly 400,000 in 2015. In the case of most objections to immigration, however, the numbers leaving the country are relevant only in so far as those concerned are former immigrants returning home, rather than British nationals emigrating. The main complaints concern the concentration of new arrivals in particular communities; the fact that they – and their children in the schools – do not speak English; their race; their colour; in sum, that they are foreign. Gross immigration in the year to June 2014 was some 580,000.
 
Secondly, there is frequent confusion between different categories of those coming to the UK: EU nationals coming to work; third country nationals also seeking work, families re-joining established former immigrants, largely from Commonwealth countries; those seeking political asylum, particularly at present coming from Africa and the Middle East; students; and, of course, an unknown number entering the country illegally. All these tend to get lumped together as being the fault of the EU.
 
However, the most recent figures from the Office for National Statistics show that net immigration from outside the EU is higher than from other EU countries. One indication of the relative social impact of EU and non-EU immigrants are figures for the granting of UK citizenship. In 2012 the total was 193,800; and of these 183,000 came from outside the EU. Only 10,500 from within.
 
All political parties have pledged to stop “benefit tourism” – that is, the supposition that nationals of other EU countries come to the UK to claim various welfare payments. We are supposed to be a “soft touch”.
 
But, apart from the anecdotal, all the evidence shows that such “benefit tourism” hardly exists. The UK has attracted immigrants from other Member States simply because of the employment situation: labour will naturally flow from areas of relatively high unemployment to those of relatively low unemployment. Overwhelmingly, EU immigrants come to the UK to work; and do so. Moreover, in the case of some occupations – for example, agriculture, the NHS and local authority care in the community – they are desperately needed.
 
But an alternative argument to that of “benefit tourism” is that EU migrants are taking jobs from British nationals, and doing so as “cheap labour”, so exerting a downward pressure on wage rates. Until recently the statistics certainly showed that wage rates were static despite large increases in numbers employed; and it is now estimated that some ten million EU nationals are resident in the UK. There is, however, no firm evidence that the positions filled by EU migrants would otherwise have been taken by equally well-qualified UK nationals. Indeed, even recruitment in other EU countries has failed to meet shortages of skilled labour in, for example, the construction industry. Moreover, the number of nationals from other EU countries resident in the UK is more than matched by the ten-and-a-half million UK nationals living in other EU Member States – so much for a policy of sending everyone home!
 
There is a strong argument for excluding bona fide university students from immigration figures. They bring fees to the universities; they gain an understanding of Britain and its way of life which they take back to their home countries; and those that stay on to work generally have high levels of qualification. It is not the case that immigrants who arrive in this country immediately become entitled to all social benefits. The Treaty and EU legislation, recently interpreted by the CJEU², allow for a period of residence to be laid down before benefits such as accommodation subsidies are payable. Most Member States do so. It is arguable that child benefits should not be payable if the family remains in the country of origin – although this might, paradoxically, lead to an increase in immigration. Finally, the most contentious of the Government’s initial objectives in the negotiations was that in-work benefits for immigrants should be restricted. Yet it has been estimated that this would save only the modest sum (in the context of total public expenditure) of £15 million a year, and would, in any case, have little effect on immigrant numbers.
 
UKIP is correct in arguing that curbing the free movement of labour within the Single Market is incompatible with EU membership. They are wrong, however, in arguing that leaving the EU would resolve the matter – or rather, would make it possible to do so and yet remain within the Single Market. Norway, often cited as a model for the UK to follow, is required to allow entry to those from EU countries seeking work. Only if the UK removes itself entirely from not just the EU, but the Single Market as well, could full control over EU immigrants be legally ended – and it is highly probable that, given the economic pressures, those who are now legal immigrants would merely find another way to enter the country. The growing numbers of asylum-seekers would continue to arrive. In sum, “regaining control of our borders” would solve very little.
 
Finally, it is worth considering more long-term aspects. According to a MigrationWatch study, 84 per cent of the UK’s population growth between 2001 and 2012 ‒ or 3.8 million – was due to migration, once births by foreign-born mothers were factored in. There is an implication that this has been unwelcome. However, most European countries (and also Japan and China) are facing a “demographic time-bomb”: the proportion of the population of working age is steadily falling as compared to the proportion in retirement. This deteriorating dependency ratio raises the question: how will future pensions be funded? Though it seems reasonable to think that the answer lies in greater saving for old age, this is in fact an illusion: whether the pensions bill at any one time is paid out of taxation or out of returns to savings and investments, it is funded by then current production. Fortunately, the UK is in a better position that most countries; and this is precisely because immigrants tend to be young, hard-working and child-bearing. The effect of the population growth recorded by MigrationWatch has been a significant improvement in the projected UK dependency ratio.
 
² Dane and Another v Jobcenter Leipzig (Case C-333/13), published November 18, 2014.

» Show less...

Discussion: In the UK primary legislation (law) is proposed by the Government and has to be passed or rejected by the elected House of Commons but (with the exception of budget related bills) also by the unelected House of Lords composed mainly of appointed Life Peers and some hereditary Peers. Both houses have certain powers of amendment.

EU Laws are proposed by the European Commission (which is appointed by governments), then amended, passed or rejected by the elected European Parliament and the Council (comprising Ministers from the elected governments of Member States). No Member State and no Party has an overall majority either in Parliament or the Council. All can be outvoted, and there is great pressure to find acceptable compromises.

Some point to the declining % participation in the European elections as a democratic flaw. Certainly the move by the Blair government, at LibDem behest to replace ‘first past the post’ election of MEPs in single member constituencies with regional lists and proportional representation, disrupted the link between UK MEPs and those who vote.

» Show less...

EU leaders were warned by economists that a “one size fits all” monetary policy would not work; and that forcing together countries with very different economies would eventually lead to a crisis. Yet the project went ahead, for political reasons. The result has been catastrophe in Greece and massive unemployment, particularly youth unemployment, in other southern countries.
 
Faced with warnings by the CBI and other business leaders that leaving the EU would be an economic disaster, Eurosceptics believe they have a clinching rebuttal. “That was what they said about Britain not joining the Euro Area; and look what a shambles that has turned out to be! And the City is doing as well as ever.”
 
In response the Remain side says: a Euro Area incorporating the UK and the Pound Sterling would have been significantly different from the present one: the influence of the Bundesbank would have been counterbalanced by that of the Bank of England, and the UK Chancellor of the Exchequer would have been an influential member of the Eurogroup. The initial response of the Area to the recent financial crisis would probably have resembled more closely that which actually occurred in the UK and in the US.
 
A stronger argument is to recall why the Euro Area was created in the first place. What would the situation have been if all the original independent currencies had still been in place? As the “Black Wednesday” events in 1992 and after demonstrated, attempts to prevent large fluctuations in the parities of independent currencies can fall victim to speculative movements, unrelated to economic fundamentals; and the resulting volatility can unacceptably distort markets and trade patterns within an open, free-trading area. This can lead to the re-imposition of exchange controls – does anyone remember the days, not so long ago, when you were allowed to take only £27 10s. or so with you when you went on holiday abroad, listed at the back of your passport? Or, worse, as in the 1930s, to “beggar-thy-neighbour” policies of protection and currency manipulation. The slogan “A Single Market requires a Single Currency” was justified. If the Euro Area had not come into existence, the Single Market itself might have collapsed during the financial crisis, as all the major currencies – as in 1992/3 – came under speculative attack. This explains why the Treaty requires any EU Member State which meets the convergence criteria laid down (apart from the UK and Denmark, which have derogations) to adopt the Euro automatically.
 
However the UK’s exclusion from the Euro Area has not, after all, led to a flight of financial institutions to Frankfurt or the collapse of the Pound. Certainly it is clear that the City of London does not appear to have suffered – and is now a major centre for Euro-related operations.
 
The principal drawback of the UK’s exclusion from the Euro Area is the way the EU is run and Britain’s influence on it. From the moment that the then Chancellor the Exchequer, Gordon Brown, was asked to leave a meeting of ECOFIN as soon as the discussions turned to Euro Area matters it became clear that there was a danger of a two-tier EU developing: the countries using the Euro might become an inner caucus, taking decisions among themselves and then pushing them through the full Council. The “outs” have, of course, obtained guarantees that their interests will be fully respected, and a guarantee that this will continue is one of the four UK points of the UK’s renegotiation agenda. However, as the Euro Area expands, the remaining “outs” could become increasingly isolated. This is perhaps why there is a strand of British opinion, and not just Eurosceptics, which looks hopefully for the Euro Area to collapse.

» Show less...

Eurosceptics assert that EU membership has meant a loss of both national and parliamentary sovereignty; and they cite as evidence the proportion of UK laws coming from the EU, with figures of 70%, 75%. or even 80% being regularly quoted. Even David Cameron has referred to a figure of “about 50%”. All this is incorrect. The most authoritative figures come from a detailed House of Commons Library report ³, which has put the real figures at no more than 6.8% for primary legislation, and 14.1% for secondary legislation. However, depending on other assumptions a wider range of figures has also been calculated.
 
Even if EU Management Committee decisions on, for example, agricultural prices, and rulings by the European Court of Justice, are added in, the figures quoted by Eurosceptics are wild exaggerations and grossly misleading..
 
Eurosceptics also try to create the impression that most EU legislation is undemocratically imposed on Britain against its will. In fact, British Ministers have seldom been outvoted in Council. The most that can be said, perhaps, is that the House of Commons, (unlike, for example the Danish Folketing) has been lax in ensuring that British Ministers – and, through them, British civil servants – are fully accountable. But this is hardly the fault of the EU.
 
Democratic control over the EU also, of course, takes place through the directly-elected European Parliament, which now has full power to amend, and if necessary block, proposed legislation. Eurosceptics object that the EP “is not a real parliament” and cite the low turnout in European elections. Yet Eurosceptics then create a paradox for themselves. If, as they assert, 70-80% of our laws come from Brussels, and therefore only 20-30% from Westminster, why is there a higher turnout in General Elections than in European Elections? In any case, the logical answer to any “democratic deficit” is not to leave the EU, but to improve and publicise the democratic controls that exist.
 
³ Research Paper 10/62, updated 2012.

» Show less...

In March 2016 the CBI stated: “Our members have given us a strong mandate to make the economic case for the UK to remain in the European Union….. a clear majority of businesses taking part in the 24 committees and councils that make up our governance structure want the UK to remain in the EU. Our survey revealed that 80% of our members want to remain in the EU, with 15% unsure and 5% wanting to leave.” FactCheck reported as follows: “A snap poll carried out by the Institute of Directors immediately after David Cameron announced his reform deal in February showed that 60 per cent of 672 members would vote to stay, 31 per cent would leave and 9 per cent didn’t know. The latest British Chambers of Commerce survey of more than 2,000 senior businesspeople got a very similar result: 60/30/9 in favour of remaining in the EU. Again, it makes a difference how big the company is. But even among the smallest businesses, who employ fewer than 10 people, it was 54 per cent stay, 34 per cent leave, 11 per cent unsure. The last time the Federation of Small Businesses asked the in-or-out question was September 2015. The polling (of more than 6,000 respondents) was much closer: 47 per cent would vote to remain, against 41 per cent would leave and 11 per cent unsure.”

» Show less...

The idea that the EU legislates on matters which should properly be left to the Member States has been around for a long time. In 1991 the then Foreign Secretary Douglas Hurd spoke of the EU interfering in the “nooks and crannies of everyday life”. Small businesses regularly complain of labour, health and safety and VAT rules which, they are told, are down to the EU, though it has been shown that often UK civil servants have tacked items onto the underlying EU legislation.
 
To understand why many of these rules have come into existence it helps to re-read the documents that led to the Single Market – in particular the Cockfield White Paper of 1985.⁴ This listed some 300 measures needed to remove trade barriers between the Member States, programmed to come into effect by the end of 1992. Lord Cockfield’s initial instinct had to been to avoid detailed legislation. Instead of harmonising technical, health and other standards, he proposed the mutual recognition of national standards. But it soon became clear that there was a lack of mutual trust. In addition, governments and businesses spoke with a forked tongue: they simultaneously called for measures to end “unfair competition” from countries with perceived lower standards (“there must be a level playing field”); but rejected measures which introduced such measures in their own countries (“no interference from Brussels”). Cockfield was obliged to propose EU-wide rules, the adoption of which was made possible by the coming into force of the Single European Act (SEA).
 
Six points need to be made about the result.
 
1. Much of this harmonisation has been of enormous benefit, particularly in the sphere of environmental protection ‒ e.g, EU-wide standards on emissions from motor vehicles.
 
2. Those who complain about interference from Brussels ignore the fact that, in the absence of common standards, each country would have needed their own. For traders, the resulting costs would have been far greater: they would now be dealing with up to twenty-eight, possibly incompatible, sets of rules rather than just one.
 
3. There is substantial evidence of what has been called “gold plating”: national administrations adding provisions not required by EU legislation, but putting the blame for the costs on “Brussels”.
 
4. The high-point of EU legislation was implementing the Single Market programme. Since then the amount of such legislation has fallen steadily. In its first annual work programme for 2015, the Commission has announced just 23 new proposals and the removal of 80 more languishing on the negotiating table.
 
5. A large proportion of the complaints about “Brussels red tape” concerns labour market laws. Most of these have their origin, not in the Single Market programme itself, but in the subsequent policy to create a “social dimension”.⁵ Largely – but not entirely – of Socialist inspiration, this was designed to prevent “social dumping”: a competitive advantage obtained through lower wages, looser health and safety requirements and other reduced labour costs. Conservative, Liberals and most Christian Democrats in the European Parliament opposed the programme; but the results of European and national elections meant that there was a majority for their introduction. That, as one-time Labour Foreign Secretary George Brown once remarked, is how democracy democs. It was not the fault of the EU itself.
 
6. In an economic system based on competition, there will always be a need to strike a balance between two objectives. On the one hand, each country or enterprise should be free to make the most of any competitive advantage. On the other, the playing field must, to some extent, be level. The political dilemma is well illustrated in the field of corporate taxation. Should countries be free to attract inward investment through low rates of tax (general considered good)? But at what stage does this result in the encouragement of tax avoidance and evasion (generally considered bad)?
 

⁴ Completing the Internal Market: White Paper from the Commission to the European Council (COM(85)310 final, 14 June 1985).
⁵ See Social Dimension of the Internal Market (Commission Working Paper SEC(88)1148 final, 14 Sept. 1988).

» Show less...

It is certainly true that, if the UK were outside the EU, trade between us would not cease. Much would, however, depend on the arrangements made in any succession negotiations.
 
The UK could, for example, join Norway, Iceland and Liechtenstein in the EEA – an outcome which has commended itself to some Eurosceptics, because it would apparently give us access to the Single Market without any “political” involvement. However, as has often been noted, including by other Eurosceptics, this would in fact produce something like the worst of all worlds: in order to access the Single Market, our exports would have to conform to EU standards, but without the UK government having had much say in their adoption (“government by fax” as it was once called). In addition, we should continue to pay substantial sums into the EU Budget: Norway, for example, pays about £78 per head (as compared to the UK’s net £135) but with no MEPs able to vote on the Budget and little say on how it is spent. Finally, we should still have to accept the “four freedoms” embodied in the Treaties, including the freedom to live, work and study anywhere in the Area. These were the main reasons why Sweden, Finland and Austria opted for full EU membership.
 
Alternatively, we might join Switzerland in a rump EFTA, or having negotiated special association or other arrangements. This also appeals to some Eurosceptics, because it would apparently allow us to pick and choose which parts of the EU acquis to accept. As Swiss banking has recently discovered, however, this is also an illusion: the relative bargaining power of the EU as a whole and that of a single small country is massively asymmetric. It is also important to note that the service sector, which is of huge importance to the UK economy and on which the UK has a trade surplus with the rest of the EU, is outside the Swiss-EU agreement. A Swiss company which wishes to sell services in within the EU must first establish a subsidiary there (or, to be precise, within the EEA) – a particularly burdensome requirement for smaller companies, even given close Swiss relations with Liechtenstein. An arrangement of this kind would clearly not suit the UK.
 
The UK is, of course, not a small country; but our negotiating position would still be relatively weak. This becomes clear when one considers relative market size. For UK industry and commerce, access to a twenty-seven-country Single Market of some 400-500 million, accounting for nearly 20% of world trade, would be vital. For industry and commerce in the remaining EU, access to a UK market of only 64 million would not.
 
Eurosceptics are generally right to argue that the re-imposition of tariffs on some UK exports by the EU would be of only marginal significance. But, as the Cockfield paper of 1985 noted, tariff barriers are no longer the most significant obstacles to free trade in the world: disparate industrial standards, health and safety and environmental regulations, etc. are more important, either inadvertently or deliberately. Outside the EU, even outside the EEA, the UK would face growing difficulties in trading unless we accepted EU legislation on industrial standards, health and safety and so on. Recapturing “sovereignty” in these matters would be an illusion.
 
Finally, there is the role UK membership of the Single Market plays in generating inward investment. At present, the UK has proved an ideal location for international companies like Nissan to access the EU market. In the 2013/14 financial year some 20% of all Foreign Direct Investment (FDI) projects in the EU came to the UK, and FDI contributed over 111,000 jobs to the UK economy. As several of the international investors concerned have already pointed out, this would not necessarily continue if the UK were to leave the EU.

» Show less...

Eurosceptics have long complained that, as an EU Member State, the UK no longer has the power to negotiate international trade agreements: the Treaties have transferred this competence to the EU Commission. This situation is not, however, merely a legal development: it reflects the reality of international economic life. In trade negotiations, where the main issue is reciprocal access to markets, the relative size of those markets matters (as in the case of the UK and the EU). As an integrated and rich market of over 500 million people, the EU has a great deal more to offer than any one Member State on its own. The idea that Britain could obtain better access to markets through bilateral trade deals is therefore an illusion.
 
One final argument for going-it-alone sometimes advanced: that opening up markets would be best achieved on a global scale through the World Trade Organisation (WTO). As the recent CBI paper⁶ notes, however, the reality of the 21st century global economy is that trade links within regions and between them are increasingly important. Whether the UK is within or outside, the EU will inevitably be a key player in opening up world trade; and the UK as a Member State will be in a much better position to ensure that it does so than as a bit-player nagging from outside.
 

⁶ Our Global Future: the business vision for a reformed EU.

» Show less...