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To veto or not to veto
12/12/2011 23:35:00

I have delayed posting about the Prime Minister’s use of the veto in the early hours of Friday morning because although it is great to see a Prime Minister standing up for our interests rather that meekly falling into line as has been the pattern in recent years, the issues involved are complex and I wanted time to reflect and to hear what the Prime Minister and others had to say in the House of Commons today. As the Prime Minister acknowledged, none of the options available to him were ideal.

The fundamental dilemma we face is that, despite not being a member of the euro (thank God), the current crisis in the eurozone still affects our economy and the measure necessary to solve it in the long term (a single fiscal policy setting out how much each member can borrow) will, in effect, lead to a dominant economic power in Europe, a situation that British foreign policy has since time immemorial sought to avoid.

The Government has concluded that it is in our interests that eurozone members do what is necessary to solve the crisis but that certain safeguards are required to protect our interests. Contrary to some reports, we weren’t asking for an opt-out but for an EU-wide guarantee that there will be a level playing field for financial services companies in all EU countries (to prevent eurozone countries using qualified majority voting to promote their financial services sectors at the expense of those of countries outside the eurozone) and that each member state would be able to regulate its financial sector properly (the Government wants to reform our banks along the lines set out in the Vickers report and it is not clear whether this can be done under current EU regulations so, whilst he was trying to protect financial services jobs in London and elsewhere, the Prime Minister wasn’t sticking up for bankers - he wanted the freedom to regulate them more effectively).

Sadly, our European partners weren’t willing to provide such safeguards. The Prime Minister was then faced with the choice of agreeing a deal he didn’t think was in our interests or using the veto. Faced with that choice, he was absolutely right to use the veto.

Some of the comments about this decision on both sides of the argument have been rather silly.

There is no reason for triumphalism - as the Prime Minister acknowledged today in the House of Commons, using the veto is not without risks because the other countries signed an agreement among themselves, albeit outside the legal framework of the EU, and there is no guarantee that they won’t work together in a way which will be damaging to our national interests. It will however be more difficult for them to do so than if the Prime Minister had agreed to a treaty amendment.

On the other side, Ed Miliband, in an article in The Guardian, said the Prime Minister “could have insisted that a different deal was done”. Er no, Ed. The Prime Minister could stop an agreement of all 27 countries that he wasn’t happy with but he has no power to stop other countries signing an agreement among themselves. It’s slightly scary that someone who aspires to be Prime Minister should be so misinformed.

He also criticised the Prime Minister for letting the other 26 countries “make crucial decisions without us”. This is the standard argument against opting out - even if you don’t particularly like what is being discussed, you should never leave an empty chair at the table. But surely there comes a point where, if you feel what is being agreed is not in our interests, you have to say no and walk away. Someone who is never prepared to do that isn’t fit to be Prime Minister. Tony Blair did it when the euro was established - eurozone members have been meeting and taking decisions that affect us ever since. If Mr Miliband thinks it’s a mistake for us not to be at that table then presumably he believes we should join the euro?

There’s also been a lot of talk about us being isolated. On some issues eg foreign policy we play a leading role in the EU but we have to accept that we are a member of a club with 27 members, 17 of whom share a single currency and have just agreed to fiscal union and 8 of whom aspire to join them. We, along with Denmark, don’t want to go down that road. We shouldn’t be embarrassed by that but nor should we try to deny the reality.

Membership of the EU is vital to our national interest. We are a trading nation so access to the single market is crucial and membership of the EU strengthens our ability to progress our foreign policy objectives too. But that doesn’t mean that when something is proposed that is contrary to our national interests we have to say yes. The Prime Minister was right to say “no” on Friday morning and he’s also right to continue to engage with our European partners. Judging by the response when I was out door knocking on Saturday and the polls that have been published over the last few days, most of the British public agree with him.

Comment on this blog


Readers' Comments

On 18/12/2011 18:18:00 Jim wrote:
"Membership of the EU is vital to our national interest."

Couldn't disagree more. It is contrary to our national interest.

"We are a trading nation so access to the single market is crucial"

The second part doesn't follow from the first. The WTO is our guarantor of free trade. I don't see the US or Japan worrying about "access to the single market". They happily buy/sell into it. As for free movement of labour, it seems totally arbitrary to me (and undesirable) that ANY (for example) Bulgarian can live/work in the UK, but a highly skilled, English speaking, Australian has to jump through hoops. The EU has fostered a sense of looking inward. We should be focussed on trading outside of the EU and bringing in the skills we need.

"and membership of the EU strengthens our ability to progress our foreign policy objectives too".

Disagree. For example, I don't think membership of the EU had anything to do with our cooperation with France over involvement with Libya. That was more to do with our military strength (and theirs) and a common view about how to proceed.

Whilst I think the PM had no choice about the veto, it is increasingly obvious that this a club where we just don't fit in. The subscription cost is rather high and taxpayers who foot the bill are being denied a chance to vote as to whether they wish to carry on.

On 20/12/2011 15:36:00 steve hales wrote:
If the vote ever came, I for one would be in favour of cutting a lot more ties with Europe and keeping the vast sums we pay (for very little return) to fund other EU countries.
On 20/12/2011 17:19:00 Alan Cornish wrote:
I believe that Germany in particular has recognised that only by allowing Greece to default will they avoid pouring good money after bad (analogy with British Leyland). It may be better to allow countries to set their own exchange rates rather than their populations believing that austerities are being imposed on them. I realise that this may well lead to a smaller Eurozone but also to a stronger Euro.
On 20/12/2011 22:46:00 Roland PETIT wrote:
Please note that both Norway and Switzerland are doing very well indeed. Their national interest appears to be reasonably well maintained when compared with the rest of the 'union'.

It is about time our PM stood firm on British interests in the EU.

On 21/12/2011 10:17:00 Victoria Price wrote:

It's great to see a prime minister who actually thinks about the UK rather than his reputation in Europe!

Cameron you have my 100% backing!

On 21/12/2011 14:47:00 Michael Bond wrote:
Vote to get us out of the EU, for once make this Goverment listen to the voters. As for Clegg and the rest of the Lib rabble, get rid of them. Most will lose their seats at the next election so will do anything to fool people into thinking they have any real ideas as to what is really going on in this country.
On 22/12/2011 22:29:00 Vivienne wrote:
I totally agree with you - well done Mr. Cameron. Let's sort this country out once and for all - a country to be proud of again. Keep up the good work - all of you.



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