Essays on the EU Debate #1: ‘Brexit will increase liberalisation and strengthen the right’

By Paul Nicholas

Without doubt, one of the biggest political questions in British politics in the next two years will be the European Union (EU) “Brexit” referendum. It is also doubtful that the union movement will speak with one voice on this issue. While many well meaning people on the left make principled arguments in favour of leaving the EU, I believe the reality is significantly different. The Treaty of Rome was based upon the belief that by making markets interdependent, more pan-European wars would be avoided. While placing a strong emphasis on markets, principles like equal pay between men and women were also central to the agenda.

In some areas, the EU has without doubt been a driver of economic liberalisation in Europe: bans on state aid (except for the banks), pushing austerity throughout the Eurozone, the Viking and Laval cases which restricts the role of national collective action, and in several other areas. However, with the exception of trade union recognition laws, nearly all improvements to workers’ rights in the UK since the late 1970s have found their genesis in European legislation: rights for part time workers, parental leave, equal pay, rights for fixed term workers, limits on working time, works councils in multinationals- the list goes on. Similarly in areas as varied as equal pay, competition law and insolvency law, the European Court of Justice has on occasion creatively constructed protections for workers.   While the effect of many of these in the UK have been watered down, they have been watered down by successive Westminster governments, including the Blair and Brown Labour Governments from 1997-2010. Take the 2002 Information and Consultation Directive. Initially, the Commission proposed that decisions taken without the requisite level of consultation of workers could be quashed. Similarly, the Directive initially proposed an automatic obligation for companies to establish consultation mechanisms modelled on German and Dutch works councils. It was intense lobbying, led by the UK and Irish governments, that shaped the watering down process.

At the 2015 European Trade Union Congress in Paris, Commission President Jean- Claude Junker, sent out a strong signal that he aims to return the Commission to a more Delors type approach where “Social Europe” is central. Junker said in Paris the Commission is to bring forward in 2016 a “Pillar of social rights” for the EU. This is exactly the type of thing which the Right in the UK wants to avoid. Junker also announced that there is to be a relaunch of social dialogue to reinvigorate the European social model and that the EU had to do more to move away from precarious contracts as being the rule. Surely, these statements must be welcomed by the left across Europe, particularly those facing attacks like we have seen since 2010 in the UK?

The agenda of both the big camps in the in the UK- those arguing for a “renegotiation” of the relationship with the EU and the most vocal arguing for withdrawal from the EU- is driven by the same logic: the EU is a bulwark against liberalisation and imposes too much “red tape” (i.e. workers’ rights) on British business. What unites the position of Cameron’s “renegotiation” and Farage’s exit is they both oppose the EU legislating to regulate business. Before becoming Prime Minister, David Cameron announced his top priority was to withdraw from the European Social Chapter. The Social Chapter embodies everything which the Right hates about the EU; in particular, they dislike the process where European Directives can become law through the agreement of the ETUC and BusinessEurope without going through the normal legislative process. It was this process that delivered the Fixed Term Workers and Part Time Workers Directives that have benefited UK workers. Similarly, it is not difficult to see that if we are to have any meaningful regulation of the banking industry, in the form of a financial transaction tax, it will come from the EU, not Westminster.

The EU does suffer somewhat from a democratic deficit, although it could be argued this has been reduced in recent EU treaties with increased legislative powers for the directly elected European Parliament. However, when compared to the British system, the EU has a broadly proportional system of parliamentary representation, an indirectly elected Council and indirectly elected President (if only the UK was so democratic!) More meaningful democratic participation is needed but democratic reform, rather than withdrawal, is the strategy which should be engaged. The idea that withdrawal from the EU could benefit workers in the UK is simply not borne out by the evidence or any political reality.

Some on the Left can say they don’t like the liberalisation agenda of the EU or its deficiencies in democratic institutions, but should we not see it as a counterbalance in terms of ever increasing attacks on workers’ rights in the UK? And at risk of being overly pragmatic and pessimistic, a vote to leave the EU will lead to an acceleration of liberalisation and our regulatory framework moving closer to the US model. The entire agenda of Cameron and Farage is not one to reform or leave the EU because it currently erodes workers’ rights but one of withdrawing in order to withdraw more workers rights.

Those on the Left in favour of withdrawal from Europe often point to the EU as the driver of the austerity agenda. However, the danger here is of viewing the EU as the bogeyman. The shape of policies of the EU is shaped by the approach of national governments. When social democratic/socialist governments have been on the ascendency, a social agenda has been pursued: when right wing and Christian democratic governments have been on the rise, policies such as austerity have been pursued. It is too easy and verging on lazy politics to view the beast in Brussels as causing all our woes. We need a pan –European vision that emphasises a social agenda at national and EU levels. Cameron and Farage both want free markets without social protection. Instead, unions and workers across Europe need to unite to deliver the positive social agenda which Junker outlined and done so in a meaningful way. The nationalism and chauvinism behind the “out” campaign is anathema to the internationalism of socialism. The message of workers to both Cameron and Farage must be we are campaigning to stay in to protect those rights you despise so much. Yes, we want reform but we want improvements to democratise the institutions and strengthen the social agenda, not more deregulation.



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