A new chapter in EU integration, whether Britain likes it or not

The new EU treaty is bound to contain something that British sceptics think requires a referendum.

There will be a new treaty. It will commit euro members to fiscal discipline. It will be largely designed by the 17 current members of the European single currency. Others can join in if they want to. Those are the essential components of the deal announced today by German Chancellor Angela Merkel and French President Nicholas Sarkozy after crisis talks in Paris.

In a sense this is exactly what had been expected. Discussions had been pointing in this direction since the end of last week. But the fact that the two leaders managed to say it at the same time in a live press conference lends the project a certain solidity and irrevocability. Something along the lines of what has been pledged might actually happen. Markets certainly seem reassured. The two leaders have promised monthly summits stretching ahead into the future (the preferred deadline is March 2012) to hammer out the details until a treaty is agreed and a new institutional and legal basis for the euro is fixed. The crucial fact as far as Britain is concerned here is that those summits will be convened among euro member heads of government. That is reasonable enough given it is their currency in crisis.

But Merkel did not describe these new summits as euro-fixing technical negotiations. She made it clear they would have a wide-reaching economic agenda to look at ways to stimulate growth through market reforms. That assertion spells disaster for David Cameron. His main demand in this process was to be included in the conversation about the future of the single market, to make sure Britain's vital interest in that aspect of European Union economic management was not overlooked in the hurry to redesign the single currency. If there are to be monthly euro-members-only summits looking at the whole growth and reform agenda it seems certain single market rules are going to get caught up in the negotiations. There are all sorts of ramifications if Britain isn't at the table, starting with the likely acceleration of moves on banking and finance reform to shift the balance of commercial power from the City of London to Frankfurt and Paris.

At a briefing shortly after the Merkel-Sarkozy press conference, the Prime Minister's spokesman made it clear the UK government's position is to examine more closely the content of what Germany and France are suggesting before forming a view on whether it would be better dealt with as a 17-member (euro only) treaty or a 27 member (full EU treaty). That position won't hold for long. It doesn't look as if Britain has much of a say anyway, and either outcome gives Cameron a headache. If he can persuade the European Council later this week that all 27 EU members should be working on a new treaty, he invites his backbenchers to present him with a shopping list of powers to repatriate during the talks. If he accepts that it should just be a 17-strong euro member treaty negotiation, he risks surrendering Britain's seat in a discussion that is plainly vital to our national economic interest. That process might still produce a document that has to be ratified by parliament. One way or another, the clamour for a referendum will grow.

Merkel and Sarkozy appear to have agreed a fast-track eurozone consolidation on a take it or leave it basis as far as the rest of the EU is concerned. From the French and German perspective it now looks as if the future of the European Union and the future of the single currency are the same thing. They are embarking on a new phase of integration. The implicit message to Britain: come along if you must, but stay in the back seat because we're driving.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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Jeremy Corbyn has lost his NEC majority - and worse could be to come

The NEC promises to be a thorn in the Labour leader's side.

Jeremy Corbyn has lost his majority on the party’s ruling national executive committee, after a longstanding demand of the Welsh and Scottish parties sees the introduction of two further appointed posts on the NEC, one each of Kezia Dugdale, leader of Scottish Labour and Carwyn Jones, the Welsh First Minister and leader of the Welsh party. 

It means that, unlike during his first year as leader, Corbyn will not have a majority on the NEC. Corbyn acquired a small majority on the party’s ruling body at last year’s Labour conference, when Community, which represents workers in steel and the third sector, was voted off in favour of the BFAWU, which represents bakers. Added to the replacement of Hilary Benn with Rebecca Long-Bailey, that gave Corbyn a small but fairly reliable majority on the NEC. (It also led to Bex Bailey, the diminutive rightwinger who sat as Youth Rep, being dubbed “Rebecca Short-Bailey” by Corbynsceptic trade union officials.) 

In practice, the new NEC is now “hung”, as Corbynsceptics sacrificed their new majority last night when they elected Glenis Wilmott, leader of the European parliamentary Labour party, as chair. Corbyn’s opponents judge that controlling the chair, which rules on procedure and interpret’s the NEC’s rules, is worth more than a majority of one. 

Divisions will hinge upon the NEC’s swing voters – Alice Perry, who is elected by councilors, Ann Black, elected by members, and Keith Vaz, the chair of BAME Labour, and the new Welsh Labour representative, appointed by Jones. Corbyn may, therefore, have cause to regret fighting quite so hard to resist the changes this time.

“All we’re asking is that we should have the same rights as Jeremy, who appoints three,” Jones told me on Monday. At an acrimonious meeting at the NEC, Jones – who has been campaigning for the change since he became leader and has already been rebuffed back in 2011 – told Corbyn that the Welsh leadership had been kept waiting “too long” for the same rights as the Westminster party. Jones, unlike Dugdale, remained neutral in the leadership race. He explained to me that “I’d expect [London] to stay out of our elections, so you’ve got to return the favour”. 

Dugdale takes a different view, and, I’m told, feels that Corbyn’s allies in Scotland have been manoeuvring against her since she became leader. She has appointed herself to sit on the NEC, where she will be a consistent vote against Corbyn.

But worse may be to come for Corbyn in the trade union section. An underappreciated aspect of Labour politics is the impact of labour politics – ie, the jostling for power and members between affliated trade unions. What happens at the Trade Union Congress doesn’t stay there, and there has long been a feeling, fairly or unfairly, that Unite – Britain’s largest trade union – throws its weight around at the TUC. 

A desire to “cut Len down to size” is likely to make itself felt in Labour.The merger of Unite with Ucatt, the construction union, takes Unite’s share of the seats on the 33-person NEC to five including the treasurer Diana Holland.  Although Unite’s total membership is larger, it affliates fewer members to the party than Usdaw, the shopworkers’ union, and the GMB do. Usdaw is a reliable block to Corbyn on the NEC and the GMB is at odds with the leadership over Trident and fracking. 

All of which means that Corbyn’s path to wide-ranging rule changes may not be as clear as his allies might wish. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.