The euro crisis poses dilemmas for Labour too

Cameron's EU pain is a gift to the opposition, but how far is Ed Miliband willing to go to destabili

Ed Miliband challenged David Cameron in parliament today on his negotiating position ahead of Friday's European Council summit. The charge was that the prime minister has promised something to his backbenchers that he cannot deliver - a repatriation of powers from Brussels. It was a line calculated to probe Tory eurosceptics' anguish over their leader's failure to capitalise on the opportunity (as they see it) of the eurozone crisis to bring about the longed for renegotiation of the UK's relationship with Brussels.

That was a fairly easy hit for a leader of the opposition. Why, when the prime minister's biggest political bruise is exposed, would he do anything other than punch it? At the moment, Labour doesn't really need to do much on Europe other than find new ways to exploit coalition pain on the subject. And just to be clear, there is a lot of pain out there. Cameron is in an appalling position. He has to go to Brussels and somehow persuade fellow EU leaders that he wholeheartedly endorses their plans to save the euro with a treaty for much closer integration, while pointing out that his party thinks a treaty for much closer integration is an affront to democracy and human dignity, so could he please have a bunch of concessions on issues unrelated to the euro, otherwise he might have to veto the whole thing. If he fails to pull that off, his backbenchers will feel betrayed. And if he manages to get concessions, they probably won't be big enough and his backbenchers will demand a referendum on the new treaty. They can sabotage it in parliament if they don't get one.

It all adds up to a Christmas hamper of opportunities for Labour. But if, as is quite possible, the situation turns still more critical for the single currency and David Cameron, Ed Miliband will also have to start formulating a position on his preferred outcome. At the moment, Labour's EU policy has been spelled out by shadow foreign secretary Douglas Alexander. He advocates taking a "hard headed view of Britain's interests", which means supporting plans to stabilise the single currency, while making sure single market rules are not skewed against the UK and pushing for reform to boost European trade. The balance of power between Westminster and Brussels is not ideal, Alexander concedes, but now is not the time to fixate on repatriation of powers.

That, as it happens is not so very far removed from the government's official negotiating position. The key difference is that Cameron actually has to deliver it and his raucous party has made it much harder for him (my column in this week's magazine deals with that in more depth). Meanwhile, Ed Balls has taken the lead for Labour in the economic debate around the single currency crisis and struck a slightly more sceptical tone. He has positioned the party firmly against British participation in any EU bailout funds. He also likes to take the credit for helping Gordon Brown keep Britain out of the single currency when Tony Blair wanted to join. Combined, the two positions make for a kind of cautious scepticism-lite - liking British membership of the EU for pragmatic commercial reasons; ready to like it more if the EU were something it is not.

That is a decent enough holding pattern. But it is not clear how it would evolve if Britain's EU relations lurch into a full-scale diplomatic crisis. Would Labour ever support Tory backbench calls for a referendum on a new EU treaty? The natural law of political opportunism dictates that they must denounce whatever deal Cameron does as a failure (which it probably will be), so should the party then join with Tory rebels and try to defeat it in parliament? If eurozone members proceed with their own fiscal consolidation, Britain's relationship with Brussels will, by definition, be changed. Will Labour then support calls for a more substantial renegotiation, including repatriation of powers? And, what it all comes down to in the end: how eurosceptic is Ed Miliband prepared to make Labour in order to make life really difficult for David Cameron and the coalition?

Labour's current position works as a cautious account of Britain's interests under the circumstances. But those circumstances are changing fast.

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

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PMQs review: Jeremy Corbyn turns "the nasty party" back on Theresa May

The Labour leader exploited Conservative splits over disability benefits.

It didn't take long for Theresa May to herald the Conservatives' Copeland by-election victory at PMQs (and one couldn't blame her). But Jeremy Corbyn swiftly brought her down to earth. The Labour leader denounced the government for "sneaking out" its decision to overrule a court judgement calling for Personal Independence Payments (PIPs) to be extended to those with severe mental health problems.

Rather than merely expressing his own outrage, Corbyn drew on that of others. He smartly quoted Tory backbencher Heidi Allen, one of the tax credit rebels, who has called on May to "think agan" and "honour" the court's rulings. The Prime Minister protested that the government was merely returning PIPs to their "original intention" and was already spending more than ever on those with mental health conditions. But Corbyn had more ammunition, denouncing Conservative policy chair George Freeman for his suggestion that those "taking pills" for anxiety aren't "really disabled". After May branded Labour "the nasty party" in her conference speech, Corbyn suggested that the Tories were once again worthy of her epithet.

May emphasised that Freeman had apologised and, as so often, warned that the "extra support" promised by Labour would be impossible without the "strong economy" guaranteed by the Conservatives. "The one thing we know about Labour is that they would bankrupt Britain," she declared. Unlike on previous occasions, Corbyn had a ready riposte, reminding the Tories that they had increased the national debt by more than every previous Labour government.

But May saved her jibe of choice for the end, recalling shadow cabinet minister Cat Smith's assertion that the Copeland result was an "incredible achivement" for her party. "I think that word actually sums up the Right Honourable Gentleman's leadership. In-cred-ible," May concluded, with a rather surreal Thatcher-esque flourish.

Yet many economists and EU experts say the same of her Brexit plan. Having repeatedly hailed the UK's "strong economy" (which has so far proved resilient), May had better hope that single market withdrawal does not wreck it. But on Brexit, as on disability benefits, it is Conservative rebels, not Corbyn, who will determine her fate.

George Eaton is political editor of the New Statesman.