Britain must defend the single market By Jo Johnson MP If Britain’s relations with the EU were ever in stable equilibrium, they are no longer so. The longstanding fault-line separating a sceptical UK from an instinctively more integrationist continental bloc widened into a gulf at the tumultuous European Council summit on December 8th-9th 2011. The decision of the Prime Minister, David Cameron, not to join negotiations to amend or supplement the EU Treaties (after other EU countries refused to include the ‘safeguards’ he had requested) captured the British public’s imagination and provided a substantial domestic political payoff. Many Conservatives – frustrated by the lack of a referendum on the Lisbon treaty, feeling vindicated in their opposition to British participation in the single currency and eager to claw back powers from Brussels – rallied around a leader who had shown ‘bulldog spirit’.1 Within a fortnight, the Conservatives took a five percentage point lead in the polls, pushing past the psychologically important 40 per cent mark. 2 (When the lead subsequently subsided in the late spring, the Prime Minister was asked to supply more such “veto moments”.)3
1 http://www.thesun.co.uk/sol/home page/news/politics/3988056/DavidCameron-savaged-on-Euro.html 2 According to samples taken by YouGov for The Sun on January 20th and by ICM for The Guardian on January 22nd 2012. 3 http://www.telegraph.co.uk/news/ politics/9287752/More-EU-vetomoments-please-Prime-Ministersays-Chris-Grayling.html
In the space of a few weeks, Britain found it had made a profound choice: to stay ‘in Europe’, but on a more semi-detached basis than ever. At the summit on March 2nd, Britain was one of only two member-states not to sign the new ‘fiscal compact’ (or Treaty on Stability, Coordination and Governance in the Monetary Union). The ramifications of these decisions will not be clear for some time. But it is premature to assume that just because the UK has not signed up to the fiscal compact that it will not in time be affected by it. Closer economic and fiscal policy co-ordination among members of the eurozone, potentially a solution to the crisis, may result in a gravitational pull of decision-making towards the inner core. While there is a consensus that Britain wants no part of the fiscal compact, it will need to guard against closer policy co-ordination among the 25 countries that are signatories to it from spilling over into areas properly the preserve of the 27. In particular, it must jealously guard the EU’s single market – and, within that, the financial services sector in particular – in the event that eurozone countries proceed towards some form of banking union. It will also need to articulate a vision for how it will continue to shape the evolution of the single market – a vital national interest – and avoid losing influence in the event of caucusing by fiscal compact countries on decisions affecting all EU members.
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