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Do the British have much influence?

Influence is extremely difficult to measure, but that does not stop participants in the Brexit debate making lots of claims about it.

Those who want the UK to remain a member make two claims in particular. First, that as a member we have considerable influence within the EU, because ‘we sit at the table and help to make the rules’. Secondly, this gives Britain influence in the wider world. If we were to leave, our influence within the EU would be nil, and it would also decline in the wider world.

For the sake of this argument one has to assume that influence, that is the ability to persuade others to do what we wish without the use of either a carrot or stick, is a valuable resource, and the more we have of it the better. This is not a view that would be universally shared by the British people, especially in regard to influence in the wider world at least. Many would appear to be quite happy if the UK had influence proportional to its population, its economic and military resources, and its talents, and would probably wonder why, and for what purpose, its leaders want any more.

However, here we are discussing influence within the EU, where it is more reasonable to think that it is of some use and some benefit. We must now ask how is it to be measured? If there are no agreed measures, anyone can make any claim about Britain’s rising or falling influence, for some reason or other, which no one can verify or contest. There is then no debate, just an exchange of impressions and press reports.

Many British observers are convinced that the UK has exercised disproportionate influence in EU policy-making. The CBI manifesto of 2013 is peppered with comments such as the UK has been ‘leading the drive towards a more outward-facing EU’[1], that it ‘shapes the research priorities’[2], and that it is ‘effective at building alliances and rarely finds itself isolated’.[3] However, evidence is needed to support this rather flattering self-image, preferably from an external source.

In this note, we will try to capture and measure influence in three ways, by the UK’s formal representation in EU institutions, by its leaders’ success in achieving their stated goals, and by examining policy outcomes to see whether there are signs of British influence. However, before reviewing some evidence on these three counts, it is necessary to recall that the UK has over the years opted out of many agreements that bind all or most of the other EU member countries. Although, it has been joined on some of these opt outs by one or more other members, it now has more opt outs than any other member.

Can a member state with the most opt outs expect to wield much influence? The UK has five major enduring opt outs.

The Schengen Area

The Thatcher Government did not participate in the Schengen Agreement in 1985, which was not negotiated under EU auspices. Under it, five of the then ten EU member countries agreed to remove border checks and controls between each other.  It became part of EU law through the Treaty of Amsterdam in 1997. As a result, most members except the UK and Ireland are now obliged to join it.

The euro

The UK declined to make any commitment to the timetable agreed by other members in the negotiations at Maastricht in 1992. The decision not to join was confirmed by the Blair Government in 1997, 2003 and 2007. There are now nine non-euro member countries, but all of them, apart from the UK, are obliged to join eventually.

The Charter of Fundamental Rights

In the negotiations that led to the Lisbon Treaty, the UK, along with Poland, negotiated an opt out that limited the right of the European Court of Justice to declare any law or institution of the UK inconsistent with this Charter, and declared that the rights in it are not justiciable in the UK. Lawyers disagree about whether this protocol has significant legal effect.

Justice and Home Affairs (JHA)

In October 2012, the Coalition Government exercised its previously-negotiated right to opt out of the provisions of the Lisbon Treaty in regard to JHA, and declared that it would selectively opt back into certain measures at later dates of its own choosing. Ireland negotiated an identical opt out.

Ever closer union

In his renegotiations David Cameron announced that he had negotiated an exemption for the UK from this cardinal principle of the European Union which dates back to the Treaty of Rome, and has been assumed or confirmed in subsequent treaties. He claims it will be written into the next EU Treaty. No other state has asked for such an exemption.

The UK is plainly an unusual, even unique, member state, and perhaps is best described as a reluctant, or half-hearted or even semi-member of the European Union. The Prime Minister says that, following his renegotiations, the UK has achieved a ‘special status’ in the EU, though whether this special status will increase UK influence in the EU seems unlikely. Other member states might reasonably see the UK’s special status as a good reason why it should not be allowed to influence significant policy decisions within the Union in the future.

The inevitable decline of British representation in EU institutions

The first of the three ways one may assess UK influence is by looking at formal representation in EU institutions. As the number of member states has grown, from nine to 28 countries, UK representation has necessarily shrunk, along with that of all the other founder or early members.

In the first European elections in 1979, the UK had 20 per cent of the seats in the European Parliament. By 2015, that had declined to 9.5 per cent (73 of 751 members). Likewise, while the UK had 17 per cent of the votes in the Council of Ministers in 1973, that has declined to 8 per cent (29 of 352 votes). Within the Commission itself, there has also been a decline. In 2004, the number of UK commissioners, along with those of other large countries, was reduced from two to one. The number of British nationals working in the Commission fell from 9.6 per cent in 2004 to 3.6 per cent in 2016.[4] This latter however is not due to an increase in the number of member countries or to any attempt to preserve a balance of nationalities. It is entirely due to a lack of suitable applicants. Britain has 12.8 per cent of the EU population.

National representation does not, however, quite tell the whole story. There has been a simultaneous decline in national vetoes, and a corresponding increase in qualified majority voting (QMV).  About 80 per cent of all legislation is now by QMV.[5] Thus the influence of Britain, and all other member countries, has shrunk since they cannot veto as many unwelcome proposals and policies as they once did.

Moreover, influence depends on the degree to which the British representatives sympathize with, can find common cause with and therefore ally with other representatives of other member countries. A majority of British MEPs are in the smaller political groupings of the European Parliament meaning that they probably have less chance of creating working alliances to influence votes, and also less chance of electing a future president. However, there seems to be no study of how groups and their alliances shape the work and votes of the European Parliament.

Business for Britain has analysed in some detail the voting in the 1,936 motions put before the European Parliament over the years 2009-2014. They found that 576 of these motions were voted against by the majority of British MEPs.[6] However, 485 of these motions nevertheless passed, a failure rate of 84 per cent. In party terms, UKIP failed to block 95 per cent of the motions they opposed, the Conservatives failed to block 87 per cent, Labour 53 per cent, and Liberal Democrats 36 per cent. This does not suggest strong influence, but then there were 1360 other motions, in which a majority of British MEPs were not opposed, and it is possible that these were on issues that some British MEPs were able to influence results.

In view of the significant opt outs mentioned above, it seems unlikely that British nationals will ever fill the five most important jobs in the EU; the presidencies of the Commission, the European Council and the Parliament, and they can hardly be selected as President of the European Central Bank or the Eurogroup. The Presidency of the Council of the EU rotates among members and if the UK votes to stay it will take up the role in July 2017.

Prime ministers’ influence in European Council decision-making

British prime ministers usually declare their goals before meetings and key decisions of the European Council. Hence whether or not they have achieved their declared goals is a rough measure of the influence of the UK. Decisions taken by four prime ministers which might be taken to demonstrate their influence within the EU are listed below, though it is an open list, so that plausible suggestions can be added to it.

Mrs Thatcher’s rebate on the UK subscription obtained at the Fontainebleau summit in 1984 is a clear case of a prime minister exercising on behalf of the UK a very considerable influence in council decision-making, since it was not only initially opposed by other members, but also to their financial cost, and to the immense benefit of the British people.

John Major’s reservations about joining the euro, as well as opting out of the Social Chapter, count less as exercising influence in the EU, than as declining to be influenced by others, which is creditable no doubt but not quite the same thing. In his memoirs he does not point to any EU policy or programme which he proposed and influenced, or any contemporary EU institution or policy which owes anything to his influence.

Tony Blair‘s declared goals with respect to the EU, on becoming prime minister were: to secure legally binding rights to keep frontier controls, to oppose the integration of the WEU with the EU, and to honour a campaign pledge and curb foreign vessels fishing for British quotas. The first two were soon lost, and forgotten, even in his memoirs, and fishermen got an agreement that boats using British quotas had to land 50% of their catch in British ports.[7]

His better known EU policy decisions, however, were to have surrendered the Social Chapter opt-out of the Maastricht treaty and to have conceded a reduction in the UK rebate, both examples of being influenced rather than exerting it. The rebate concession is important because it was, according to his speeches at the time, though not his memoirs, a quid pro quo for reform of the CAP, which never happened. This suggests that even under the favourable circumstances of the UK presidency, the UK at the time had little influence. Blair’s major foreign policy decisions, Kosovo and  Iraq, reinforce this conclusion and suggest that he had far more influence in the U.S. Like Major, he does not claim in his memoirs to have influenced the EU in any particular policy or direction.

David Cameron’s veto of treaty change to help the stricken euro in 2011 did not change the plans of other members in any respect. His attempts to persuade the Commission to cut its budget and significantly reduce its staff in 2014 were announced as a success but subsequently have been shown to have failed.[8] His recent renegotiations also fell well short of his declared goals. They are nonetheless a high water mark of British influence which is unlikely to be repeated, since his hand was strengthened  by the forthcoming referendum. Their significance can, however, only be finally judged post-referendum, and after the European Court has its say.

Policy and programme outcomes

The most direct way of measuring UK influence would be to discover the number of EU regulations or directives, where the UK has taken a distinctive position which other members were initially not inclined to support, but where British representatives eventually prevailed to the benefit of UK exporters, taxpayers and consumers.

This method has a respectable pedigree in political science, though it is not readily applied to the EU. The UK Permanent Representative in Brussels sought patiently to explain the extraordinarily complex web of relationships that form the EU legislative process to members of the Commons European Scrutiny Committee.[9]  Parts of it are confidential and completely hidden, so it seems doubtful whether any researcher could identify who was responsible for any of the more than three thousand EU directives and regulations that together form the single market.[10] One academic expert, who is ‘very strongly supportive of the European Union’, observed of its decision-making that  ‘It is not clear who is responsible for what. It is not clear what coalitions governed on what issues, what the majority was on what issues, or who were the winners and losers.’[11]

Financial regulation is one field in which there has been a thorough examination of earlier decision-making to assess British influence. It was conducted by Europe Economics and referred to EU efforts ‘to create/deepen the Single Market’ during its Financial Services Action Plan 1998-2006, focusing specifically on the Markets in Financial Instruments Directive (MiFID) of 2004. This is an area in which one might expect the UK to exercise great influence within the EU given that its financial sector is much larger than any other in the EU. Europe Economics concluded that EU policymakers, at that time, had decided that British practice was best.[12] The MiFID therefore ‘closely reflected British norms and policy theories’, and in many respects ‘mimicked UK practice’. It might therefore be taken as a telling example of the UK’s influence within the EU.

Europe Economics went on to point out, however, that the UK was able to exercise such influence largely because of favourable circumstances at the time: the EU was then seeking to liberalize financial services, and the UK was then thought to embody international best regulatory practice. After the financial crisis, circumstances changed fundamentally. The EU is now seeking to restrict and control the financial sector, and is no longer looking to the UK for inspiration or guidance. Far from it. Hence, the second half of Europe Economics’ analysis largely consists of explaining why UK influence is likely to be insignificant or negligible in the foreseeable future, and why it should probably expect to be regularly overruled or outvoted, as it already has been on the bonus cap, the Financial Transactions Tax and Solvency II.[13]

The recent Bank of England report corroborates this conclusion and does not convey much confidence in the UK’s ability to influence EU policymakers. On the contrary, they see the possibility of ‘problematic’ regulation in the future, which is one reason why in his renegotiations. The prime minister was anxious to secure some kind of protection for non-euro countries being put at a disadvantage by decisions within the Eurogroup. Whether he has, or could ever obtain such protection remains to be seen. The Eurogroup will undoubtedly have to caucus without the non-euro members. The betting must be, as Europe Economics found, that the UK influence in this area will remain insignificant or negligible.

Trade agreements           

Many British observers have claimed that, left to themselves without British influence, EU members would have resisted the global trend to freer trade would have remained a protectionist bloc, which may be true but is difficult to demonstrate. What is not difficult to demonstrate is that the EU has preferred agreements with small trading partners, has neglected Commonwealth countries and a relatively low proportion of its agreements include services. This suggests that the UK has had little influence over its trade negotiating strategy for the past 40 years. Even the present TTIP negotiations seem long overdue, by about 20 years, and a major concession had to be made to France before these negotiations could begin to exclude all audio-visual products from the negotiations, so that French culture might be protected from an American onslaught. It so happens that this is a rather strong sector in the UK.

The distribution of R&D funds

According to three global measures of academic excellence of universities, citation impact studies of researchers as well as by Nobel prizes, the UK research community is far and away the EU leader.[15] One might therefore suppose that the UK had a strong influence on its programmes to support scientific research. Many spokespersons for the research community support this claim by saying it has obtained disproportionate research funds from the European Commission, more in fact than the UK has put in. These claims are, however, folk myths of the research community. The evidence shows quite clearly that the leaders over the 15 years 2000-2014 in the distribution of funds per researcher have been Belgium and Spain, neither of whose universities appear very often in world rankings. In the ordinal rankings of funds distributed per researcher, the UK ends up in 8th position and Germany in 10th, which does not suggest that the UK exercises disproportionate influence in these programmes.[16]

 

Notes

[1] CBI, ‘Our Global Future: the business vision for a reformed EU’, 2013, p.22, Available from: http://news.cbi.org.uk/reports/our-global-future/our-global-future/

[2] Ibid, p. 76.

[3] Ibid, p. 13.

[4] Business for Britain, Change or Go, London, 2015, p.331, Available from: http://businessforbritain.org/change-or-go/.  The figures for British nationals in the Commission are from http://ec.europa.eu/civil_service/about/figures/index_en.htm

[5] Consilium, ‘Qualified Majority’, http://www.consilium.europa.eu/en/council-eu/voting-system/qualified-majority/

[6] Business for Britain, ‘How much influence does Britain have in the European Parliament?’, Briefing Note 5

[7] C. Booker and Richard North, The Great Deception: Can the European Union Survive?, London, Continuum, 2005, p.412.

[8] At an EU Budget summit on 7/8 Feb 2013, Cameron and other EU leaders agreed a €908 billion limit for the seven-year period 2014 – 2020. This was 3 per cent lower than in the previous seven-year period. Hence his claim. However, a few months later this decision was overturned, and the EU budget, and the UK contribution sharply increased. Source: Tim Congdon’s open email 30th September 2014 quoting evidence from the Office of Budget Responsibility, the Office of National Statistics and the HM Treasury White Paper, European Union Finances, 2014.

[9] It took him a couple of hours, and it is doubtful whether any outsider could have followed it.  Sir Jon Cunliffe, UK Permanent Representative to the EU, Minutes of Evidence HC 109-I House of Commons Oral Evidence taken before the European Scrutiny Committee, Wed 8 May 2013.

http://www.publications.parliament.uk/pa/cm201314/cmselect/cmeuleg/c109-i/c10901.htm

[10]  ‘As of 1 October 2012, 1,420 directives and 1,769 regulations were in force to ensure the functioning of the Single Market.’ Source: Internal Market Scoreboard. European Union, 2013, p.9.

[11]  Professor Simon Hix, Uncorrected Transcript of Oral Evidence, to be published as HC 109-ii, taken before the European Scrutiny Committee in the House Of Commons 12 June 2013, Q.454.

[12] Europe Economics, Optimal Integration in the Single Market: A Synoptic Review, A Europe Economics report for BIS, April 2013, pp.82-94. This directive 2004/39/EC was the product of an EU Committee of Wise Men on the Regulation of European Securities Markets 2001 chaired by Alexandre Lamfalussy which reported in 2001. One of its seven members was British, Nigel Wicks, a Treasury mandarin at the time. http://ec.europa.eu/internal_market/securities/docs/lamfalussy/wisemen/final-report-wise-men_en.pdf.

[13] For a fully documented account of the decline of UK influence in financial services regulation  see Business for Britain, Chang or Go, pp.325-342.

[14] Europe Economics, Optimal Integration in the Single Market: A Synoptic Review, A Europe Economics report for BIS,  April 2013.

[15] Three global measures of academic excellence of universities:

The Shanghai Academic Ranking of World Universities, http://www.shanghairanking.com/ARWU2014.html

The Times Higher Education rankings of the world’s top 100 universities, https://www.timeshighereducation.com/world-university-rankings

The CWTS Leiden rankings, http://www.leidenranking.com/

[16] Chapter 43


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