How EU rules raise the UK’s game

22 Feb 16

The EU, with its imposition of rules and regulations, has tempered the UK’s fondness for muddling along, forcing it to make better decisions and become more far sighted

European Parliament building


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Europe is a rule maker. There’s no getting around it. Even if you’re firmly on the side of staying in the European Union, you should take this on the chin. While its legislative agenda has got shorter, the EU is fundamentally in the job of making rules that compel, change or stop what member nations like the UK can do. And even well-made rules can be problematic for governments.

Sometimes they can be over-inclusive, covering situations they were perhaps never intended to. Some people argue, for example, that freedom of movement for workers was never supposed to end up with people who move being entitled to welfare benefits too. Rules can also have the opposite quality and fail to cover situations they were planned to cover. Proponents of the market economy, for example, complain about what France or Italy do to support their national champions, despite state aid rules.

Rules are imperfect, in other words. We adopt them to avoid the alternative – discretion, untrammelled decision making and the problem of coordination. If you want to make the argument for staying in the EU, then I think it’s important to say this directly.

Aims and effects

Working in government, I saw the effect of rules, especially European ones, all the time. Typically, the effect was positive. I say that for two reasons.

The first is due to the aims of European rules. Literally I mean the four freedoms – of goods, services, capital and labour – and all that liberal utopian stuff. The benefits to the UK are large and demonstrable. But that’s an argument for another piece.

The second reason why European rules are beneficial in the UK is that they improve the structure of decision making. That’s quite a claim, and one that is less commonly discussed, so let me say more.

The UK is unusual in having a remarkably flexible system of government. This is a strength of our system, though it also means that the centre is very powerful compared to local government; the executive has a lot of decision making authority and, in the end, parliament is sovereign too. Unlike the US or Germany, or for that matter many Commonwealth countries, we don’t have a constitution providing a deep set of rules and principles that the government or parliament are bound by. To a much greater extent than others, we make it up as we go along.

Other than when the EU has something to say about it. By joining the EU, as well as via the European Convention of Human Rights, we signed up to a deeper set of rules and principles – such as free movement – which have now put a structure around government decision making.

While this is usually something that we complain about in the UK, it has benefits too. As a civil servant, I led the policy work on the Gender Recognition Act. This was a piece of legislation that gives transsexual people the right to seek legal recognition of the gender in which they are now living.

European law shaped this policymaking process in two critical ways. First, we got started on it because the European Court of Human Rights ruled that the UK was in breach of the convention.

Perhaps in time, even if left to our own devices, we would have addressed the challenges facing transsexual people living in the wrong gender. However, they are a small group. No political party needs to court their votes. And there is prejudice against them. The reality is that they may have been waiting a long time had it not been for the impetus provided by European law.

While the UK could leave the EU without withdrawing from the European Convention, similar issues of national sovereignty could trigger two exits, not one. The Conservative manifesto pledged to break “the formal link between British courts and the European Court of Human Rights”.

In any case, European law itself played a second role in my example. Due to its wide-ranging anti-discrimination rules, we had to keep checking whether our new legislation would succeed in providing transsexual people with the rights to which they were entitled. Without the structure provided by European rules, we might have tried to do the minimum, left issues to be resolved another day and muddled along, as we often characteristically do in the UK. Instead, we were compelled to produce detailed, comprehensive legislation.

Look in the longer term

The EU also provides an important structure in another area of policy where I’ve worked: higher education funding.

Some of that structure is due to free movement. We have to operate a student finance system in the UK that does not discriminate against students from the rest of the EU. This provides a useful additional pressure to worry about the cost of student loans, and whether we have adequate mechanisms for collecting repayments after graduation.

Then there’s a second constraint, if you like, that comes about due to Eurostat and the discipline that it provides in how public spending, assets and liabilities are classified.

Without discussing all the ways in which student loans might be provided, one factor is how they will be scored in the public finances. Inevitably, there is a temptation to adopt a mechanism that minimises their impact, at least in the short term, on public spending. But then we have to worry about what Eurostat, and the ONS acting within Eurostat guidance, might decide. So that temptation goes away and we end up making decisions that take a more long-term perspective.

The rights of transsexual people and higher education funding are just two examples of where the impact of European law is both significant and, in my view, benign. European laws do not just get in the way of what we might do otherwise in the UK – they also help us to make better decisions. This is what we signed up for when we joined the EU. We were right to do so.

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