Labour needs a Commission on Europe

Such a Commission would ask hard questions, but also be more productive than David Cameron's opportunistic offer of a referendum.

So how should Labour respond to David Cameron and Nigel Farage on Europe? The reflex denunciations of opportunism and short-termism - Cameron as a Tory version of the 1970s Harold Wilson - are OK for the time being but do not take us very far.

Ed Miliband has done well to position Labour as not being hostile in principle to a referendum but politely asking where is the agreement to a new EU Treaty or to Britain's a la carte renogiation announced by the prime minister.

But this holding policy is not enough. When I was elected to the European Parliament in 1989 it was the beginning of Labour's decade of euphoria. Jacques Delors had made his famous Social Europe speech at the TUC and the Tories were destroyed by their ERM debacle and Maastricht divisions.

Tony Blair trashed Tory isolationism and mocked John Major 's feeble Europe policy.

When I stood down as leader of Labour MEPs in 2000, the uncritical EU enthusiasm was already fading. The Treasury did not like the Euro. Blair blocked or delayed key pro-worker directives. The Amsterdam and Nice Treaties did not lead to the abolition of Britain as John Redwood declared but nor did they make the EU work better.

North America or the BRICS were far more exciting in economic terms than slow growth Europe.

Foreign policy unity evaporated over Iraq. The Lib Dems came out for a referendum on the EU constitutional treaty, obliging Blair to follow rather than lead in setting the nation's Europe policy.

Europe became a hate word as a new generation of Tories headed by Cameron, Liam Fox, William Hague and IDS competed in scorning and rubbishing the EU. It was impossible to be selected as a Tory candidate unless an oath of dis-allegiance to the EU was sworn.

Cameron broke political links with centre right leaders like Angela Merkel, Nicolas Sarkozy and Jose Manuel Barroso. Nigel Farage emerged as Cameron's dark avatar saying in public what top Tories say in the tea room.

Month by month Cameron found himself being devoured by his own creation. Tory Europhobia took on its own life. It demanded the red meat of an in-out referendum.

Now Cameron has provoked a crisis in Europe with his overt willingness to accept Britain leaving the EU in 2017 and the consequent crisis that will rock Europe in a way not seen since the 1930s. So what should Labour's response be?

There is a short term flurry of Newsnight or Today appearances but Labour needs a long term strategic response to the European question.

After John Smith took over as Labour leader in 1992 he realized that the piece meal approach to the Thatcher revolution of the 1980s was insufficient. Shadow cabinet ministers did not have the capacity to think more widely beyond the demands of tactical Commons oppositionism.

Smith set up the Commission for Social Justice with a broad membership and a wide remit to come up with what turned into the modernized social democracy that won Labour three elections. It brought new younger thinkers and future politicians like David Miliband into active politics.

Ed Miliband should set up a wide ranging Commission on Europe to produce, ahead of the 2015 election, a wide ranging programme for Britain's future relationship with Europe. A Commission on Europe should have a membership well beyond Labour and should search new younger thinkers not the representatives of the Blair era pro Europeans. It should involve business leaders - not those who sign the usual letters to the FT on EU matters but new generation entrepreneurs. Seats should be reserved for thinkers from continental nations.

The Commission should ask hard questions about economic reform, including how to improve genuine cooperation that can lead to greater competitiveness while promoting social justice. It could examine why so many trade unions in the EU still feel comfortable with 20th century oppositionist and confrontational politics rather than the no-strike cooperation with capital that has preserved jobs and training in Nordic or German speaking Europe.

It should propose serious reforms to EU institution including the size and scope of the Commission and how national parliaments could have co-decision powers with the Parliament in Strasbourg.

The question of a referendum is part of the process. But in contrast to David Cameron's opportunistic vote seeking decision to begin by offering us a chance to quit Europe, a Commission on Europe would offer the fresh analysis and thinking that political parties have avoided for more than a decade.

Alan Donnelly was Leader of the Labour MEPs in the European Parliament


David Cameron gives a press conference after an EU summit last October. Photograph: Getty Images
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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.