The closest Cameron has got to setting out an EU "shopping list" yet few have noticed

What do David Cameron's seven EU 
reform commitments mean?

Writing in the Sunday Telegraph, David Cameron set out seven objectives - or eight if you read between the lines - for a Conservative EU reform agenda ahead of that potential 2017 EU referendum. Surprisingly, despite this being the most explicit that David Cameron has been in setting out a 'shopping list' (an unfortunate term), it has generated surprisingly little attention, in the UK and abroad.

To be fair, none of these objectives are completely new, one is not strictly to do with the EU, while in the case of some of the others it would be rather difficult to define success. Interestingly only the point about removing the commitment to “ever closer union” would definitely require treaty change.

In large parts, these are broad principles rather than specific policies - which is wholly appropriate given that it would be silly to set out a set of clear polices so far in advance (though some of these could easily get under way now). Here are the seven:

Commitment	What does it involve?	Treaty Change?
“Powers flowing away from Brussels, not always to it”	This is an overarching principle which would take a number of forms, including repatriating entire areas of EU powers, such as regional policy, to repealing specific regulations, to structural changes in the EU (incl. possible Treaty changes) that makes it easier to roll back the acquis such as a "green card" for national parliaments.	Depends. Reforms to regional policy and repealing individual rules, such as the Working Time Directive, would not require treaty change. Removing entire EU powers or structural changes might.
“National parliaments able to work together to block unwanted European legislation.”	At present a third or more of national parliaments can require the European Commission to reconsider proposals (a yellow card) - but it has only been used twice. There are various proposed ways of strengthening this mechanism to allow national parliaments collectively the power to strike down EU laws. This could give them a legal veto – the ‘red card’ or simply strengthen the existing mechanism.	If placed into EU law it would require treaty change. However, the Dutch Foreign Minister has suggested this could also be done through a "political agreement" between the Member States requiring the Commission to treat the yellow card as a de facto veto.
“Businesses liberated from red tape and benefiting from the strength of the EU’s own market – the biggest and wealthiest on the planet – to open up greater free trade with North America and Asia.”	De-regulation is very difficult to quantify. It could involve proposals to exempt small business from EU regulations. It could also involve imposing a repeal mechanism (a green card operated by national parliaments), sunset clauses, for EU laws as well as reviewing old EU regulations. This agenda also suggests further services liberalisation and the completion of the Trans-Atlantic Trade and Investment Partnership (TTIP) and further free trade agreements.	None of the "competitiveness agenda" requires Treaty Change. However, it is far from certain that TTIP will be agreed and then ratified while cutting EU red tape is always a challenge in the face of interest groups and the European Parliament - but far from impossible in the face of political will.
“Our police forces and justice systems able to protect British citizens, unencumbered by unnecessary interference from the European institutions, including the ECHR.”	This could involve withdrawal from the ECHR, successful reform of the ECHR or a UK Bill of Rights limiting its impact in the UK. The reference to “European Institutions” could imply removing the European Court of Justice’s (ECJ) jurisdiction over EU crime and policing law.	Withdrawing from the ECHR would not require EU treaty change as it's not to do with the EU. Removing ECJ jurisdiction over EU crime and policing laws would.
“Free movement to take up work, not free benefits.”	This could involve a number of changes to EU rules around free movement including strengthening the link between economic contribution of EU migrants and access to benefits and ending "exportability" of child benefits.	Reforming the Free Movement Directive and the Social Security Regulation could be done without treaty change. Putting an outright cap on EU migration - which Cameron has NOT suggested - would require Treaty change.
"Support for the continued enlargement of the EU to new members but with new mechanisms in place to prevent vast migrations across the Continent.”	This would involve imposing tougher transitional controls on all future EU accessions, for example by extending the existing 7 year maximum transitional period or linking the right to free movement to population size and/or relative wealth levels.	EU enlargement requires a new Treaty with the accession state(s) over which all existing EU members would have a veto, so London could push this demand as the price for its agreement. However, enlargement does not alter the underlying EU Treaties themselves.
Dealing properly with the concept of “ever closer union”.	The EU treaties currently include a commitment to “ever closer union”. Removing these words would be largely symbolic but could have some political, and possible indirect judicial, impact.	Yes, given that the concept is itself enshrined in the treaty.

In addition, though he has not said so specifically, apart from a passing reference to need to achieve a union for both eurozone and non-eurozone countries, another priority for David Cameron will most definitely be to secure safeguards against eurozone caucasing.

A number of questions still remain of course, including the various reform ideas not touched on this article, including the EU budget, employment law or dealing with the ECJ (though they all could fit under the general principles he has laid out).

Lastly, David Cameron has said he will pursue this reform agenda followed by a referendum “if he is Prime Minister”. This is important as he appears to be setting down a red-line in any future negotiations with the Liberal Democrats to continue the Coalition.

The big question is if these reforms were to fail, would he campaign to leave or stay in regardless?

Commission's dismissal of national parliaments' concerns over EPPO shows why a red card is needed

While all eyes are on EU free movement and EU migrant's rights to welfare access, the Commission has put out its response to the 'yellow card' shown by national parliaments with respect to its proposal for a European Public Prosecutor's Office (EPPO) - a body which would "investigate and prosecute EU-fraud and other crimes affecting the Union's financial interests".

To re-cap, national parliaments in eleven member states - the UK, Czech Republic, Cyprus, France, Hungary, Ireland, Malta, Netherlands, Sweden, Romania and Slovenia - complained that the plans breached the subsidiarity principle - i.e. the principle that the EU should not act where member states are just as able to act on their own. This is only the second occasion on which the yellow card has been deployed.

The weakness in the current system is that a yellow card only compels the Commission to consider whether to "maintain, amend or withdraw the proposal", meaning that if the Commission is determined to push ahead regardless, it can do so. This is is exactly what has happened in this case, with the Commission concluding that the "proposal complies with the principle of subsidiarity... and that a withdrawal or an amendment of that proposal is not required."

The actual document is very detailed, and while its good that the Commission has properly engaged with concerns raised by national parliaments, it is clear that the Commission's mind is already made up as per the following section:

"the drafters of the Treaty have expressly provided for the possibility of establishing the European Public Prosecutor's Office in Article 86 TFEU... This provision gives a strong indication that the establishment of the European Public Prosecutor’s Office cannot be considered per se and in the abstract to be in breach of the principle of subsidiarity."

Very tellingly, the Commission has also appointed itself as the arbiter of what constitutes an 'acceptable' complaint on subsidiarity grounds, arguing that:

"In analysing the reasoned opinions, the Commission has distinguished between arguments relating to the principle of subsidiarity, or that could be interpreted as subsidiarity concerns, and other arguments relating to the principle of proportionality, to policy choices unrelated to subsidiarity, or to other policy or legal issues."

Although the Treaty states the decision has to be reached by unanimity (so no danger of the UK being vetoed), this episode highlights the need to turn the 'yellow card' into an outright 'red card' - i.e. a definite veto. This could apply to existing as well as proposed EU legislation.

In addition, national parliaments should be given more than the existing 8 week period to respond. The scope for national parliaments to object to EU proposals should also be widened from the narrowly defined principle of subsidiarity to prevent the Commission from being able to undermine their validity. As we've argued, in order for national parliaments to have a real impact in the EU they need real powers - otherwise this widely shared objective will not come to much.

The Dutch are emerging as Europe's thought leaders on reform

The Dutch are quickly becoming Europe's thought leaders on EU reform. The Dutch government's "subsidiarity review" contained numerous interesting ideas for EU reform, the Dutch lower house, Tweede Kamer recently published a paper outlining key proposals for how to strengthen the role of national parliaments. And today, the Dutch foreign minister, Frans Timmermans, used a piece in the FT to set out some new ideas for reform.

Timmermans wraps his ideas in quite friendly language but there are some pretty sharp lines in there.

He says that "During the crisis the European Commission...was relegated to the sidelines and never regained the initiative", adding

"That has not stopped its machine from producing directives and regulations, creating a regulatory burden that bears down on businesses and people." 

He notes the European Parliament

"has been fully empowered by the Treaty of Lisbon. It has an important role to play, but at every turn it demands more resources for more Europe while it attracts ever lower electoral turnouts."

His key ideas include:

• A European Governance Manifesto for the next five years with the member states, laying down what the EU should and should not do. "This will mean more Europe in some areas, and less in others."
• "Create a smaller, reformed commission with a president and vice-presidents heading a limited number of policy clusters. The vice-presidents would have the sole authority to initiate legislation."
• Encouraging "national parliaments to bring Europe back home where it belongs." He throws his weight behind a "red card" for national parliaments - if one-third of them object, a Commission proposal is history. As you know, we love this idea. 

However, he says he doesn't want treaty changes and, interestingly, claims the ideas he put forth can be achieved without such changes. We assume that, for the red card, this would effectively mean a political agreement to the effect that the current yellow card means a red card in practice.

Timmermans concludes:

"In this we do not stand alone. Other partners have put forward proposals that share a similar thrust: a more focused and balanced EU with less burdensome regulation. Let us seize this momentum and start with an in-depth debate on change and reform. For this is our chance to shape “our” Europe together."

National democracy pushing back: European Commission shown its second ever 'yellow card'

The European Commission has just been shown its second ever 'yellow card'. Remember, this is the provision introduced by the Lisbon Treaty, stating that if one third or more national parliaments object to an EU proposal on subsidiarity grounds (within an eight week window), then the Commission has to reconsider the proposal. In theory, the Commission can choose to ignore parliaments (one of our long-standing criticisms of the mechanisms). However, in fairness, the last time the yellow card was issued - in the case of the so-called 'Monti II' Regulation on the right to strike - the Commission did scrap the thing.

National parliaments from eleven EU member states - the UK, Czech Republic, Cyprus, France, Hungary, Ireland, Malta, Netherlands, Sweden, Romania and Slovenia - have now complained that plans for a European Public Prosecutor Office (EPPO) breach the subsidiarity principle.

According to the Lisbon Treaty, the establishment of the EPPO requires unanimity, and the UK would have sought to opt out, but that also means that other EU countries could have pressed ahead with this without Britain.

So the move is still significant for a few reasons:

• It is another example of how national parliaments are increasingly pushing back against EU centralisation, and how little appetite there is for 'ever closer union' (the Commission's proposal was limited, with the prosecutor only being responsible for investigating fraud involving EU funds).

• It shows national parliaments can agree. In total, 15 chambers from eleven EU member states objected to the idea. Bear in mind that an objection raised by a chamber from a country whose parliament is unicameral (e.g. Sweden or Cyprus) counts as two votes. Therefore, to some extent, it counters the argument that a new 'red card' system allowing a group of national parliaments to block unwanted EU proposals - which we have supported for a while - would not work because national parliaments would not get their act together. 

The ball is now in the European Commission's court. It will take quite a bit of nerve to ignore 15 more or less democratically elected chambers (*ehum*) in Europe....

Hague says UK wants national parliaments to have power to show 'red card' to EU proposals

William Hague backs giving national parliaments
a new 'red card' to replace the current yellow card

William Hague will today further develop plans for a new 'red card' system for national parliaments to block unwelcome laws from Brussels, a move first proposed by Europe Minister David Lidington a couple of weeks ago. In a speech in Germany, Hague will argue that only by giving greater powers to national MPs, rather than MEPs in the European Parliament, will Europe be able to restore the democratic deficit.

The proposed 'red card' would beef up the little-known 'yellow card' system already in place, which is pretty weak in practice since it only forces the Commission to ‘reconsider’ a proposal.

We have long championed this approach and the idea of a ‘red card’ in particular, including in our paper making the case for ‘European localism’, published in 2011. Today, our Director Mats Persson backed the move and is quoted by PA as saying,

"Allowing national parliaments to block unwanted EU laws would go a long way to bring back democratic accountability over EU decisions.”

"However, whilst it's encouraging that the UK government is looking at this, it must press ahead with this reform now to avoid the impression that it has no immediate strategy in Europe - a charge that's becoming more frequent. There's support for this reform in other parts of the EU."

This is the first major proposal for EU reform the Government has made since Cameron's speech and it is a very welcome one. The fact Hague will make his speech in Germany is no accident and there is certainly a great deal of support for this idea amongst other member states who feel that for too long the EU institutions have run roughshod over national politics - yesterday's intervention from the Commission on migrant benefits (another area where the UK's concerns are shared with other powerful EU countries) is a case in point.

Its also worth noting that this option would enjoy substantial support among the UK public with 42% of respondents in the recent ComRes poll for Open Europe listing "giving the UK parliament more powers to block unwanted EU laws" as one of their top four priorities for renegotiation. Of all the available options, this was the second most popular after immigration.

We need to see much more of the same and, all importantly, the political will to make it a reality.

This is welcome stuff: David Lidington says national parliaments could be given a 'red card' over EU proposals

National Parliaments' should be allowed
to show the EU the red card

This is an idea that's very close to our hearts - and an idea that we have promoted for a very long time.

The first bits of UK Europe Minister David Lidington's interview with German daily Die Welt have just been published on the paper's webpage. We'll have to wait until tomorrow to see the full version. But from what we can see so far, Lidington's interview is likely to reverberate quite a bit across Europe.

He said,

"Perhaps we should lower the threshold for national parliaments to take action against initiatives from Brussels; perhaps we should introduce the principle of a 'red card' so that a given number of national parliaments can block initiatives from the [European] Commission."

Sounds familiar? Well, the 'red card' was first advocated by Open Europe in 2011 in our report 'The case for European Localism'. And again by Lidington's PPS Tobias Ellwood MP in a publication for Open Europe in December 2012, where he argued:

"Any future [EU] Treaty change should include some system of the red card system with the right quota and powers."

A red card is an improvement over a yellow

Open Europe's Director Mats Persson pushed the idea in the Telegraph here in January. Under the Lisbon Treaty, if a third of national parliaments show the Commission the current 'yellow card', the Commission is obliged to reconsider its proposal and explain why it wants to change it, scrap it or push ahead with it. To date, the Commission has withdrawn a proposal in only one case after being shown the 'yellow card' - the so-called 'Monti II' Regulation on the right to strike.

However, this provision has several weaknesses. First, it doesn't oblige the Commission to actually drop the proposal, but only to reconsider it. So it's a far cry from a veto. Secondly, it's only supposed to happen on 'subsidiarity' grounds - and not on 'proportionality'. Thirdly, a third of parliaments are supposed to agree within an eight-week window, meaning that if the Commission tables a proposal in August or September - when most parliaments are in recess - it can basically push ahead with anything.

In other words, it really doesn't do that much to close the EU's infamous democratic deficit. Nor to strengthen the powers of national MPs - an aspect which, as we've argued repeatedly, is absolutely vital if the EU is to regain democratic legitimately.

Therefore, a 'red card' provision giving a certain number of national parliaments acting in unison (the threshold needs to be discussed) an actual veto right, would be an absolutely massive improvement. This is also an area where the UK will have support from Germany and others if it pitches it right.

In the interview, Lidington also pointed out that several times in the past,

"the content of [EU] treaties has been interpreted in a way which was not desired or expected at the time the treaty changes were decided on. Sometimes, the European Commission or the European Parliament try to expand the boundaries of their competences." 

The Europe Minister also stressed that the EU's single market for services is "painfully underdeveloped". echoing similar remarks on the importance of deepening the single market before. However, this time they come after he said that Open Europe's proposals to reignite the EU's services sector and boost EU-wide GDP by up to €294bn were "interesting" and "worth exploring".

More please!

Commons weighs in on deposit schemes

Hats off to the House of Commons.

Earlier today it grasped the nettle and employed the Lisbon Treaty's 'yellow card' procedure for the first time (if nine national parliaments object to a proposal from the Commission on 'subsidiarity' grounds, within an eight-week window, the Commission is obliged to re-consider - but not scrap - the proposal). The House of Lords was slightly quicker off the blocks, using the procedure last week to object to the EU's proposed directive on seasonal workers from third countries.

The Commons provided a "reasoned opinion" on the proposal to amend the so-called Investor Compensation Schemes Directive, objecting to it on subsidiarity grounds.

As we've argued before, this proposal raises various concerns, as under the proposed rules member states would be required to lend to each other should a bank go bust and deposits needed to be guaranteed. As the Swedish Parliament argued, this presents a 'moral hazard' since some member states might be tempted to under-fund their scheme, knowing that someone else would pick up the final bill.

The House of Commons joined its counterparts in Sweden, Germany and Austria in objecting to the proposal.

Only problem is, the deadline for objecting to the proposal expires today. Eight weeks doesn't exactly give national parliaments plenty of time to mobilise, particularly when, as it did now, it coincides with parliamentary recess in most European countries (almost as if it was planned).

We confess to not being up to speed with how many national parliaments actually managed to formally object to the proposal in the end - but will be back shortly with an update.

Regardless, it's good to see MPs taking responsibility.