Britain has demanded that the European Union abandon its “ever closer union” principle for all, fearing that ongoing euro reform measures will exert an “inexorable” integrationist pull.
In a speech watched closely in Berlin, chancellor of the exchequer George Osborne told German politicians and business leaders that London's demands could be a win-win.
These demands, in particular to reform and protect the single market, could secure a Yes vote in Britain’s looming EU referendum, he said, while in return strengthening the euro.
“We in Britain can support you in the euro zone and make the lasting changes that you need to see to strengthen the euro,” Mr Osborne told Germany’s industry federation in Berlin. “In return, you can help us make the changes we need to safeguard the interests of those economies which are not in the euro zone.”
Ever closer union, he said, was supported only “by a tiny proportion” of British voters and was “not right” for the majority, who rejected its perceived commitment to intensifying political integration.
Doing the rounds
Britain’s Conservative government is committed to holding a referendum on the UK’s EU membership before the end of next year. Mr Osborne is leading a new round of talks in European capitals to seek support for its reform demands.
He said long-standing British concerns had been exacerbated by looming efforts to bed down in EU law euro crisis-era legislation. These measures, such as EU bank supervisory and rescue measures, were agreed through inter- governmental deals among EU member states, but outside EU legal structures.
Mr Osborne said that British support for these efforts to strengthen the euro were conditional on securing legally binding commitments that they would not place Britain and other non-euro members at a “systemic disadvantage” within the union.
Britain wants recognition that the EU is a multi-currency bloc and a ban on discrimination of businesses based on their choice of currency or headquarters.
Non-euro member participation in further EU integration projects, he added, “must be voluntary and never compulsory”.
No bailouts
Mr Osborne also insisted on a binding agreement that non-euro taxpayers cannot be forced to bankroll future euro bailouts.
“We shouldn’t have to fight a running battle on these issues,” he said. “We need to put things on an orderly basis with agreed principles.”
Mr Osborne’s remarks were greeted in Berlin with interest, but also relief that London has finally begun to fill in the detail of its long-flagged EU reform demands.
However, Britain faces a growing belief in Germany and elsewhere that its reform demands, in particular calls for welfare restrictions for immigrant workers, actually mask a Whitehall cherry-picking exercise for domestic consumption.
Aware of this, Mr Osborne reminded his Berlin audience that Britain and Germany were a Wertegemeinschaft – cultural allies – and should act as such on EU reform and fiscal policy.
