Why Miliband's position on the EU is stronger than it appears

Tory unity will prove shortlived and the Labour leader could execute a relatively painless U-turn on a referendum.

For a day when the Prime Minister and the leader of the opposition said exactly what they had been expected to say, there was rather a lot of excitement.

David Cameron yesterday promised to attempt a renegotiation of Britain’s membership of the European Union (EU) and, having secured a better deal (as he sees it) invite the British people to back the arrangement or walk away. This position had already been advertised in advance, albeit after much behind-the-scenes haggling and Downing Street floor-pacing.

Ed Miliband, meanwhile, said he thought it was not a good idea to pledge a referendum now and that the whole thing was a reckless gamble with Britain’s future driven only by the need to quell brewing rebellion on the Tory benches. This position, also produced after much haggling in the shadow cabinet, was known in advance too.

And yet, somehow, when it actually happened it was still big news. That is partly because all the pent-up journalistic energy that had gone into the pre-speech reporting had to be released and partly because the two positions got a good theatrical airing in Prime Minister’s Questions in the Commons. Besides, thinking something is very likely to happen and it actually happening are different things.

So where does the land lie now? There was a strong feeling around Westminster yesterday that Cameron had played a tough hand well and that Miliband had thrown away a bunch of good cards. The justification for that view is that the Tories seemed uncannily united, cheering the PM lustily on an issue that is famously divisive in the Conservative Party. The Labour leader, meanwhile, looked trapped in a contradictory position. The essence of his argument is that Cameron’s pledge offers dangerous uncertainty, yet Miliband seemed uncertain as to what precisely he wanted.

That is because there are enough people on the Labour side who think a referendum is inevitable and so consider it madness to rule one out. That leaves Miliband in the position of partially closing the door, which is never as dramatic as slamming it shut (or flinging it open).

The concern for the Labour referendum advocates is that Miliband is stuck now in a position of perpetually explaining why he doesn’t "trust the people", when Cameron can say he has a perfectly clear policy of democratic renewal for the EU and wants to get on with the job of making it happen. Cameron’s position is indeed clear. It is also unrealistic - the renegotiation that the Tory benches envisage will never happen to their satisfaction. By contrast, Miliband’s position is realistic and unclear. He is right to question the wisdom of starting a phoney referendum war on issues that are plainly a distraction from what the UK government and EU leaders should be doing. But to people who don’t follow these things obsessively, Miliband's argument is not a quick sell.

In the first phase of the news cycle, Cameron’s gimmicky clarity trumps Miliband’s technical realism. But will that continue to be the case? It is certainly true that Labour will find it hard to get through the next two years, let alone an election campaign, without a better answer to the “trust the people” question.

At the moment, Miliband has cover from the Liberal Democrats who share his view of the issue and use pretty much the same language. But it is not at all guaranteed that this tacit alliance will hold. The situation is even trickier for the Lib Dems than for Labour to the extent that they have bandied around the idea of an in/out referendum before. So refusing to back one when it actually comes up as a serious prospect risks reinforcing all the worst aspects of Nick Clegg’s tarnished brand – pledge-busting, slippery, gutless etc. All the mean things the focus groups have been saying about him since the whole tuition fees debacle will be rehearsed again.

There is a strong chance the Lib Dems will go into the next election with an EU referendum pledge. One senior Clegg advisor, conceding the point that it would be agony to fight a campaign on a platform ostensibly denying the nation a choice, recently told me: “the best way to take the issue and nullify it is to match the Tories’ commitment.” This advisor also expected Labour to come to the same conclusion. The best way to stop referendum questions dominating a campaign would be for everyone to have one in their manifesto. For the time being that doesn’t appear to be Clegg’s formal position, but the option is plainly being kept open.

If the Lib Dems fold on the referendum point, Labour will look very exposed. (It also matters because it will be one of those issues that gets kicked around in discussions of who could more easily form a coalition with whom in the event of another hung parliament.)

Interestingly, one of the key reasons Miliband doesn’t think it is a good idea to pledge a plebiscite is that he thinks he has a decent chance of actually becoming Prime Minister after the next election. He doesn’t fancy spending the first 18 months of his term in office on the campaign trail against Ukip and what would by then be a hysterically anti-EU opposition Tory party. It is a fair point. If David Cameron needs to fiddle around the policy margins pretending the biggest issue in the world right now is repatriating the right to scrap paid holiday and maternity leave to stop his backbenchers hating him for a couple of days, well, that’s his problem. Why should that set Labour’s agenda for government?

But that’s not an argument that Miliband or his allies can easily make in public. It doubles down on the risk of looking arrogant: "We think we’re going to win and when we do, we’ll have better things to do than ask the people if they want to stay in the EU" is not what you might call a populist narrative.

Still, there are at least two reasons why I think Miliband’s position is better than it looks right now.

First, the Tories are united only in relief that they have a clear position and in joy that their leader has done something unabashedly, uncompromisingly true blue Conservative. Neither of those conditions can stay in place for long. The renegotiation will not happen quickly enough for the hardline sceptics and whatever concessions Cameron extracts from fellow EU leaders will have to be matched with compromises elsewhere. Tory MPs are allergic to EU compromise.

There will be European Council meetings at least every six months between now and the election and in the run-up to each one, Conservatives will expect the Prime Minister to show progress in his grand repatriation project. Even if there is a modicum of willingness to accommodate British demands in Brussels, it won’t be on a timetable that satisfies the sceptics.

Meanwhile, Cameron is still in coalition with the Lib Dems. What Tory MPs were cheering yesterday was a great emancipation. They felt liberated. But they aren’t and when they realise it, they’ll be cross. They think they have won a right to dictate policy to Downing Street and will only get more assertive and impatient as a result. Yet the Lib Dems will also now have to become more assertive to prove that Clegg has more say over what goes on than some Euro-bashing Conservative backbencher. The potential for that dynamic to cause havoc and undermine Cameron’s position is immense.

The second reason Miliband’s position isn’t quite so bad is that he has a clearer escape route than is generally realised. In the run-up to the big Cameron speech, the Labour leader made an important policy concession: he said he would not repeal the European Union Bill. This is the piece of coalition legislation that provides for a referendum in the event of any new treaty transferring powers to Brussels. (Labour abstained when parliament voted on it.)

If there is a new EU treaty in train at some point over the next two years – which is very possible, but not certain – Miliband can say that he would, in government, honour the provisions of the act. If pressed he could even say that, yes, this new treaty looks likely to substantially alter the terms of Britain’s relations with the EU and so, yes, he would call a referendum. If he really wanted to, he could say the treaty is so substantial that the question on the ballot should be endorsement of the new arrangement or exit – thereby essentially matching Cameron’s pledge from yesterday. I don’t say this is a likely scenario, simply that the space for a relatively painless U-turn for the Labour leader may well be there should he need it.

By far the greater threat to Miliband is the prospect of his party generally lacking patience and confidence in his judgment. If opinion polls show a referendum pledge bounce for Cameron – as a few Ukip considerers slip back to the Tories – Labour’s lead could shrivel into the margin of error. At that point there is bound to be a revival of chatter about the inadequacy of the Labour leader’s performance, his perceived lack of policy clarity and want of strategic direction. Those anxieties are never far below the surface of Labour’s veneer of unity. Miliband must now hope that the even more superficial, brittle unity that David Cameron achieved in his own party yesterday ruptures first.
 

Ed Miliband delivers a speech on the EU at the CBI last year. Photograph: Getty Images.

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

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What type of Brexit did we vote for? 150,000 Conservative members will decide

As Michael Gove launches his leadership bid, what Leave looks like will be decided by Conservative activists.

Why did 17 million people vote to the leave the European Union, and what did they want? That’s the question that will shape the direction of British politics and economics for the next half-century, perhaps longer.

Vote Leave triumphed in part because they fought a campaign that combined ruthless precision about what the European Union would do – the illusory £350m a week that could be clawed back with a Brexit vote, the imagined 75 million Turks who would rock up to Britain in the days after a Remain vote – with calculated ambiguity about what exit would look like.

Now that ambiguity will be clarified – by just 150,000 people.

 That’s part of why the initial Brexit losses on the stock market have been clawed back – there is still some expectation that we may end up with a more diluted version of a Leave vote than the version offered by Vote Leave. Within the Treasury, the expectation is that the initial “Brexit shock” has been pushed back until the last quarter of the year, when the election of a new Conservative leader will give markets an idea of what to expect.  

Michael Gove, who kicked off his surprise bid today, is running as the “full-fat” version offered by Vote Leave: exit from not just the European Union but from the single market, a cash bounty for Britain’s public services, more investment in science and education. Make Britain great again!

Although my reading of the Conservative parliamentary party is that Gove’s chances of getting to the top two are receding, with Andrea Leadsom the likely beneficiary. She, too, will offer something close to the unadulterated version of exit that Gove is running on. That is the version that is making officials in Whitehall and the Bank of England most nervous, as they expect it means exit on World Trade Organisation terms, followed by lengthy and severe recession.

Elsewhere, both Stephen Crabb and Theresa May, who supported a Remain vote, have kicked off their campaigns with a promise that “Brexit means Brexit” in the words of May, while Crabb has conceded that, in his view, the Leave vote means that Britain will have to take more control of its borders as part of any exit deal. May has made retaining Britain’s single market access a priority, Crabb has not.

On the Labour side, John McDonnell has set out his red lines in a Brexit negotiation, and again remaining in the single market is a red line, alongside access to the European Investment Bank, and the maintenance of “social Europe”. But he, too, has stated that Brexit means the “end of free movement”.

My reading – and indeed the reading within McDonnell’s circle – is that it is the loyalists who are likely to emerge victorious in Labour’s power struggle, although it could yet be under a different leader. (Serious figures in that camp are thinking about whether Clive Lewis might be the solution to the party’s woes.) Even if they don’t, the rebels’ alternate is likely either to be drawn from the party’s Brownite tendency or to have that faction acting as its guarantors, making an end to free movement a near-certainty on the Labour side.

Why does that matter? Well, the emerging consensus on Whitehall is that, provided you were willing to sacrifice the bulk of Britain’s financial services to Frankfurt and Paris, there is a deal to be struck in which Britain remains subject to only three of the four freedoms – free movement of goods, services, capital and people – but retains access to the single market. 

That means that what Brexit actually looks like remains a matter of conjecture, a subject of considerable consternation for British officials. For staff at the Bank of England,  who have to make a judgement call in their August inflation report as to what the impact of an out vote will be. The Office of Budget Responsibility expects that it will be heavily led by the Bank. Britain's short-term economic future will be driven not by elected politicians but by polls of the Conservative membership. A tense few months await. 

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