On Twitter: @JamesFirth and @s_r_o_c (post feed)

Got a tip? tip@sroc.eu

Saturday, 10 December 2011

"Two speed" Europe? It's already three speed

Okay, I'm going to get some stick about City protectionism and dilution of employee rights.  I accept many of the excuses made by Cameron in public for distancing the UK from the EU sound pretty lame.

But there's also some good reasons, especially in the area of bank regulation where the UK seems to be pushing for a tougher stance than other EU member states.  I can also see that making decisions on regulation within the EU could be beset by political squabbles resulting in half-baked legislation, and it might make sense at this stage for the City to go it alone.

And on the issue of transaction tax that's really a global question that the EU has only limited options without unduly affecting global institutions operating within the EU.  Yes, I know there are a lot of excuses out there, but the fact is global businesses will do all they can to minimise their tax burden.

But these are side issues. I'm disturbed by a load of shouty people crying out, "disaster!" How terrible it would be for the UK to be sidelined within Europe.  As the saying goes, don't panic!

As you were, folks.  There's already at least "three speeds" in Europe.  Firstly there's the European Union of 27 countries, then there's the 17 Eurozone countries sharing the common currency.  And then there's the real periphery of the European Economic Area, which includes all 27 EU member states plus Iceland, Liechtenstein and Norway.

Oh, and there's the Council of Europe, covering 47 states, not to be confused with the Council of the European Union.

It's tempting to see David Cameron's move as catastrophic, but I can't see any evidence that it will be.  It might not be the best move for the UK or Europe, but equally it might actually be a good move for the UK... And Europe.

I don't think anyone really understands what the full ramifications will be, but I see no evidence for saying it is definitely a bad move, and a lot of evidence indicating it won't itself ostracise the UK from the EU.  Nothing David Cameron has done (so far) has relegated our formal standing within the EU.

There already exists an incredibly complex arrangement between the institutions of the European Union (The Council of the EU, the European Parliament, the European Court of Justice) and other institutions within the wider European borders, such as the European Court of Human Rights.

At the moment the UK is not a member of the Eurozone (common currency).  We're already on the outside of the "core club" in some regards, if the core club consists of full EU membership and adoption of the common currency.

We also chose not to be a participant in other lesser areas, such as the Schengen agreement, which allows passportless travel between many member states.  On this point I wonder if passport checks (and associated queues) is a barrier to EU businesses wanting to do business in the UK? Who knows, but this kind of argument is no more tenuous than the other guff floating around about the EU.

The pressing problem within Europe is the Euro and we're not a member of the Eurozone -  so what if we have to deal from the sidelines on the resolution of the Euro crisis.  The effects on the UK may be serious, but secondary.  Let those with a primary interest have a primary say in sorting it out.

Besides, the UK still has a lot of political batting power within the EU.  Also, on the finance side, the UK at the moment is fundamental to the core of Europe, not least because it is one of the few remaining net contributors.

In 2010, contributions were expected to be as follows: Germany: 19.6%, France: (18%), Italy: (13.9%), UK: (10.4%), Spain: (9.6%).  It's anyone's guess how things will pan out for 2012 but a couple of countries on this list stand out as being in a worse shape than the UK to continue contributing.

For the people blaming the UK for potentially causing the collapse of the Euro, that's like a football team blaming its supporters for poor performance on the pitch.  Sure, we need to help where we can, and we have done.  But all loyalty has limits.

Now OK, if you were hoping to see the UK join the Euro in the next 10 years or so I can see how the PM might have stuck a major stick in the spokes.  I however will rest easy.


No comments:

Post a Comment

Comments will be accepted so long as they're on-topic, do not include gratuitous language and do not include personal attacks or libellous assertions.

Comments are the views of the commentator and not necessarily the view of the blog owner.

Comments on newer posts are not normally pre-moderated and the blog owner cannot be held responsible for comments made by 3rd parties.

Requests for comment removal will be considered via the Contact section (above) or email to editorial@slightlyrightofcentre.com.