Tag Archives: europe

Taking the Brexit Bus Seriously

As Theresa May announces her plan to notify Article 50 by next March, the UK is drawing up its ‘red lines’ on its exit from the EU. Although there is little detail as to what the UK government will seek, one thing is clear: an end to free movement of people is being considered as the major implication of the British people’s vote to leave. Everything else – including single market membership – must come second to this goal. Even the Labour Party has stepped in line with this new political orthodoxy. The interpretation is that the referendum result was a vote against free movement for EU citizens to the UK.

The problem with this approach is that Theresa May is not just abiding by the result of the referendum, but she is trying to infer a single reason for the vote.  And the choice she has made has huge implications for the Brexit negotiations. So what if there was another basis for the negotiations, a different ‘red line’ to limiting immigration?

We send the EU £350 million a week. Let’s fund our NHS instead

brexit-bus

There were many arguments used in favour of leaving the EU, but the most prominent was written on the side of the Leave campaign’s bus and driven around the country.  It dominated large parts of the referendum campaign, formed the backdrop to hundreds of photo opportunities and interviews, shaped the news agenda for weeks, was hotly contested, but was never erased, and never withdrawn. After years of austerity, the official Leave  campaign zeroed in on the EU membership fee as one of the major solutions for over-stretched public services. Opinion polls in the run-up to the vote showed that many people shared the sense that the UK paid too much into the EU, and as a net contributor was somehow being ‘taken for a ride’.

So let’s imagine basing our Brexit negotiations on repatriating the £350 million per week that is handed over to the EU. How does that change our approach to the EU27?

The first result is that the focus shifts hugely towards discussing the Article 50 separation deal, rather than ignoring that in favour of discussions on a future relationship. The terms of the separation are crucial to getting the UK a good Brexit deal, one where we can save money and reinvest that for the public good. Instead of an army of trade negotiators, the UK government recruits hundreds of accountants, to go through the EU’s books and find ways to limit the UK’s future liabilities. So what are the Brexit bus red lines?

1) Brexit means a clean financial break: Once the UK is out of the EU it will not accept making any transfers to the EU27. This will include payments for future EU liabilities, such as pensions for EU officials, EU institutions and agencies (including the cost of their relocation). A settlement may have to be made with regard to the current budgetary period.

2) The costs of immigration should be limited: the access of EU migrants to U.K. social security was a major feature of the referendum campaign, so the question of who pays for the social benefits of EU citizens in the U.K., and UK citizens living in EU Member States will be a major factor in the negotiations. Expect the UK to try to drive a hard bargain about social security payments and liability for health and social costs incurred by U.K. retirees in Spain, and liabilities for EU nationals in the UK.

Of course, the benefits of Brexit can only be truly realised if the new UK-EU relationship is also based on financial neutrality. So the negotiations about the future relationship should be driven by this key principle. The next principle is therefore:
3) Solidarity is a national issue: EU Member States can fund solidarity and social cohesion from their own budget; the UK’s relationship will be based solely on trade, not the redistribution of wealth via social programmes.

Finally, the UK will argue for a single market, but with no fees:
4)  No pay for play: no contributions from the UK to the EU’s budget in exchange for single market access. The UK will have no political say in the making of the single market’s laws, so should not have to pay a fee to access them. If the EU wants to continue to trade smoothly with the UK, then the UK will accept adopting the single market’s rules, but will not subsidise its operation. The financial benefit that the EU27 will receive through the UK’s large balance of payment deficit should be sufficient without further contributions.

Together, these key red lines will ensure that Brexit can respect the clearly expressed will of the British people, and make Brexit a success for the NHS, and for Britain.

Of course, most, if not all of these red lines might prove impossible to realise. And at some stage, the fact that the £350 million per week claim was a lie would also have to be addressed. However, it is certainly not unrealistic to imagine that a UK negotiation in Europe might be based entirely upon money.  Margaret Thatcher’s ‘handbagging’ of Brussels to secure the UK  budget rebate should remind us that the UK is often happy to take a transactional approach to Europe.

The point of this post is not to suggest that this would be a better Brexit strategy, but merely to point out that there is more than one type of Brexit possible. Brexit does not mean Brexit – there are many different versions. The one that is chosen over the coming months will have huge ramifications for both the UK and the EU.

Why Brexit Britain should still be interested in the circular economy action plan

Another piece on the Green Alliance blog:

Why Brexit Britain should still be interested in the EU’s Circular Economy Action Plan

 

 

Brexit and the Brussels Brits

 

euukAmidst the shock and carnage of Brexit, Brits living in Brussels will be particularly shocked, and indeed horrified. An expat community is witnessing its own country tearing itself apart, lashing out in anger, inflicting pain and unleashing chaos on itself, but also on the rest of Europe. Adding to the shock for many is the questioning of our own identities: is this still the Britain that we left?

Beyond the political, economic, social and environmental questions, Brits in Brussels will eventually have their own concerns: what will become of them? Jobs, lives, families in Belgium have all been built by UK citizens taking advantage of the UK’s membership of the EU, so what will happen to them now? The statement of the (outgoing) UK Prime Minister, David Cameron, to Brits living abroad that, ‘there will be no immediate changes in your circumstances’ is hardly reassuring.

So what will the impact of Brexit be for those of us in the ‘Brussels bubble’?

The first harsh truth is that today, this is a very minor issue. The seismic shock of Brexit is so big that the minor rumblings of a few expats will have little impact on UK politics. Even when the question of UK citizens abroad rises up the agenda, the biggest issue will be the future of retirees in Spain, not working age expats in Brussels. This will be a long way down the list of priorities of the next British Prime Minister. And to be fair, for many British citizens working on EU issues in Brussels their own situation may be at the back of their minds today as they think of the impact on the UK, Europe, and the world.

 The legal uncertainty is perhaps the biggest issue: will expat Brits still have the right to live and work in Belgium once the UK has left the EU? Of course, this depends upon the nature of the new UK/EU agreement. EEA membership would safeguard the right to work in Belgium. But it’s extremely difficult to see how the UK could keep out EU migrants from Britain, whilst retaining the right for UK citizens to work abroad. Brits have the right to Belgian citizenship after living in the country for more than five years, so that will be a solution of sorts for some. Many Brits, of course, already live in mixed nationality families, with intertwined lives that make a Brexit even more complex and threatening.

So what future for the diverse range of Brits in Brussels?

  1. The ‘Eurocrat’

Brits working within the EU Institutions are in a state of shock. There are implications for their lives and careers, but these are also people who are committed to an idea of Europe, and an idea of Britain’s relationship with the EU, which has just been put in question.

When the UK leaves, will they lose their jobs? Jean-Claude Juncker has already written to them to promise that he will fight for their jobs. But whilst their contracts may continue, they risk marginalization within the Institutions, with no senior roles allocated for Brits. Those on fixed-term contracts are most under threat. And those working for UK MEPs will clearly be looking for new careers after the next Parliament elections in 2019.

  1. The Lobbyist

 Brits in Brussels have traditionally traded off two things: access and communication. For lobbyists within the public affairs agencies, uncertainty creates business. Expect a boom in the next couple of years for political lobbyists in Brussels as the convoluted process of negotiating a new UK / EU relationship begins. British lobbyists will be in demand, both from UK companies seeking to understand the regulatory impact of Brexit, and from EU companies who are concerned about their export markets and adapting to a new way of trading with the UK.

But at the same time, those dealing with the regular EU policy-making will take a hit. Who will employ a British lobbyist to steer a path through a legislative process that will not include the UK? The value of having British contacts in the EU Institutions has just gone through the floor. Understanding the Franco-German political axis will become more important, along with growing powers like Poland. So maybe it will be short-term gain for some, but long-term pain for all?

  1. The Communicator

The second advantage Brits have in Brussels is their ability to communicate in English. Unfair as it may seem, amongst all these polyglot Europeans the mono-lingual Brit is still valued for their ability to write in their mother tongue. English is likely to remain an important language in Brussels – within both political and business circles.

PR professionals, Communications Directors, writers and editors will all hope that their skills will remain bankable in a Brit-free EU. But whether they will have the right to continue to use those skills by working outside the UK is another question.  

  1. The Facilitator

 Brussels is full of trade associations, alliances, and coalitions, and the people who bring these groups together. British staffers in these offices will be feeling nervous: what future for them if they work for an association without any UK members in future? For those involved in the world of EU funding the prospects are even more uncertain. UK participation in EU programmes and funds is not guaranteed. And the role of British regional offices in Brussels, universities, and others who seek to build partnerships around EU funds is clearly under threat.

  1. The Campaigner

There is a large community of Brits working for campaigning NGOs in Brussels, across all sectors. Almost all of them were strongly in favour of Remain, on the basis of preserving social and environmental rights and values. They are now already campaigning to ensure that the issues close to their hearts are not damaged by Brexit, whether in the UK or the rest of Europe. Many will argue that there is more need than ever for progressive British voices in Brussels. But will those voices still be heard? It is clear that the political landscape has changed, perhaps forever. Responding will certainly require new approaches.

  1. The next generation

Beyond the fate of the Brits who currently live and work in Brussels, perhaps it is more important to think of those who are to come. Or rather, those who may not be able to come in future. Brussels is a European city of movement – people arrive, work, live, love, and then often leave. Some of us stay, but many simply take advantage of free movement to experience living in another country for a few months or years. That right is now under threat. The ‘Brussels Brits’ who are already here have their own concerns, but the next generation may not have the right to come and live in this confusing, infuriating, complex, delightful, and wonderful city – or in the rest of the European Union. And that’s the real shame.

 

Simon Wilson is a long-term Brit in Brussels. This article is written in a personal capacity.

 

The Biggest EU Referendum Myth?

There is a lot of competition for the biggest myth of the UK referendum campaign. Viewed from the outside – by a Brit who has lived in Brussels so long I don’t have a vote – it’s like watching someone shooting themselves in the foot (‘See? That’s showed you!’). A horrified fascination that you just can’t turn your head away from.

But amidst all the lies, myths and misinformation, there is one that jumps out at me (today at least).

It was summed up this morning on the radio by a leave voter interviewed in a pub. ‘Once it’s all done and dusted they’ll find something else to talk about’, he said, with an air of boredom about the whole EU debate.

Yes, I’m sure that people in the UK are going to be thoroughly bored of talking about, reading about, watching stories about the EU by 24 June.

One year ago, only 2% of Brits thought that the UK’s relationship with Europe was the most important issue facing the country (according to this Ipsos MORI survey). But now, the country is on the verge of voting to make it not just the issue of the week, or month, but the defining issue for years to come.

A Leave vote will make the European Union THE story in the UK for years. The economic, political, legal, social consequences will dominate the news, the economy, and the political agenda.

Negotiating a new relationship with the EU will take years. And with every other Member State getting a veto, the negotiations are likely to prove complex and uncertain. The UK’s position will be unclear and incoherent, since Parliament will have vastly different views on how to proceed to the Brexit Tories. (What model to go for: Norway, Switzerland, Canada, Turkey, WTO?) Other Member States have their own issues to worry about, and domestic elections to win – which will hardly make them likely to cave to the UK’s self-hostage situation (‘Give me the money or I’ll shoot…. myself’).

And in the meantime, pretty much everything that happens in the UK will be viewed through the lens of the Brexit. Environment? Social policies? NHS? Unemployment? Infrastructure investment? The danger is that there will be no space to discuss any of these things seriously for years. It will all be on hold as the UK deals with the crisis and uncertainty, tries to rebuild trade relations, and to find the answers to hundreds of questions that have not even been asked yet.

So bad news for those sick of the EU debate. After years of wilfully refusing to discuss Europe, Brexit will put it at the heart of British political discourse for years to come.

The EU Guide to Broken Europe

An answer to The EU Guide to Broken Belgium

This article in the Wall Street Journal provoked huge interest in Belgium last week, listing as it does numerous reasons why Belgium is failing economically.

Various parts of the Belgian press accused the WSJ of ‘Belgium bashing’, but the criticisms were actually taken from a European Commission report – the so-called Country Specific Recommendations for Belgium. The article had simply ‘interpreted’ the Eurojargon in the report to shed light on some of the weaknesses inherent in this country – the high taxes, grid-locked roads, stagnated labour market and bloated public sector.

Now, as someone who has lived in Belgium for 15 years, I can’t say that I didn’t recognise these criticisms. But (as a seasoned Euro-watcher) what seemed more interesting was the indirect, indeed obtuse way that the criticisms had been made in the Commission report.

The European Commission makes these ‘Country Specific Recommendations’  (CSR) to all 27 Member States at this time every year. The Commission is trying to give supportive advice, rather than making vicious attacks. Like your best friend tactfully telling you to lose a little weight. Not like Gordon Ramsey screaming that you are a useless ****. But the trouble with European Commission documents of course, is that they are often so indirect as to be… well, almost incomprehensible.

For example, the Belgian CSR states,

‘The coordination issues inherent in a highly regionalised structure put emphasis on an efficient organisation of public governance, as the presence of multiple networks, layers and actors may lead to duplication of structures with weakened governance and higher administrative costs.’

This is very indirect. So indirect as to require a translation: Belgium has an inflated, inefficient, ineffective and expensive public sector.

This set me wondering: If all of their criticisms are as opaque as this, maybe the Commission needs some help? Perhaps someone needs to provide simple translations to the Country Specific Recommendations for other countries as well? And perhaps that might make Belgians feel a little better about being targeted by the Commission and the Wall Street Journal?

With this in mind, I turned to another Country Specific Report. Since they are also experiencing a few problems right now, I thought that I’d start with Greece. So here are a few of the Commission recommendations for Greece, with my translations in italics.

1. The consolidation measures taken so far have not been sufficient in attaining the required fiscal effort to correct the excessive deficit.

You may think that you are hurting already, but you need to make more cuts, and raise more taxes, because you are still running the country at a loss.

2. Net lending to the corporate sector remained negative in 2012.

Your banks won’t lend to your businesses because they have no confidence that they’ll get their money back.

3. The fiscal effort envisaged by the authorities is not compatible with an actual correction of the excessive deficit by 2014. Possible additional consolidation measures specified have been temporarily withdrawn and at any rate would not be sufficient.

Your attempts to balance the budget are a joke! You’ve back-tracked on the measures you promised to take, and in any case they weren’t nearly enough in the first place.

4. The labour market reforms proposed by the government aim to increase labour market participation and mobility. The reform is ambitious and relevant to boost labour market participation. However, the reforms are not yet enshrined in law and the time span for implementation seems rather short.

Your labour reforms sound good in theory, but we fell off our chairs laughing at your implausible timetable: let’s face it, the reforms will never take place!

5. VAT administration [should be] reviewed in an effort to increase efficiency, improve tax collection and fight fraud.

There are huge tax loopholes, massive fraud, and your tax authorities are incompetent.

6. There still appear to be governance obstacles to market-driven consolidation in the banking sector, which affect the overall efficiency of the financial sector.

The market knows that your banks are screwed, but you are blocking the necessary changes and pretending everything is ok.

7. Policy action to reduce the high tax wedge for low-wage earners and improve the integration of the long-term unemployed into the labour market has been limited so far.

The working poor pay ridiculously high taxes, and once you’re unemployed for any time you won’t get another job. And you’re doing nothing to solve this.

8. The credibility of fiscal policy over the medium-term would be reinforced by the composition of government expenditure and revenues better reflecting the growth impact of the different spending items and revenue sources.

Your budget is not credible as you haven’t even thought about what impact it will have on the real economy.

Pretty damning, eh? Still, perhaps that’s not unexpected, after all, we are talking about Greece here.

Except… I lied. Whilst all of the quotes above are genuine Commission recommendations, none of them are from the Greek report. 1-2 are addressed to the UK, 3-4 to the Netherlands, and 5-7 to Germany. Oh, and the last one is addressed to the whole of the Eurozone.

Feel better now, Belgium (and Greece)?