5
Full-Hearted Consent? Britain in
Europe from Heath to Blair
Introduction
How can British relations with the EU since Britain joined the club in
1973 be explained? The previous chapter suggested the powerful legacy
of post-war events. This chapter takes these analytical strands forward
by exploring British relations with the EC/EU from the premiership of
Edward Heath until that of Tony Blair. The chapter continues the Britain
in Europe theme by exploring the preferences of British governments,
the motivations for these preferences, the capacity to attain UK objectives
and the ways in which preferences, motivation and capacity have
changed over time. It will be shown how Britain engaged with important
developments in European integration such as the Single European
Act and the Maastricht Treaty. The chapter will link with the Europe in
Britain themes by indicating the ways in which political changes in the
UK (such as the development of Conservative Euroscepticism in the
1990s) had effects on Britain's relations with the EU and led to serious
questions being asked about Britain's continued membership of the
organization. The chapter will conclude with an overview of New
Labour's EU policies and will ask whether they also indicate continued
differential and conditional engagement with the EU and, as such,
despite some of Blair's rhetorical commitment to Europe, are actually
indicative of substantial continuities in Britain's EU policies.
1974­5: renegotiation and referendum
EC membership in 1973 was for Edward Heath his defining political
accomplishment and the one of which he remained most proud. This
counted for little when continued British economic decline and major
74
industrial disputes led to the fall of his government in February 1974 and
his replacement as Prime Minister by Harold Wilson. As leader of the
opposition Britain's membership of the EC posed something of a
dilemma for Wilson. As Prime Minister he had sought EC membership
in 1967, but in Britain's adversarial political system he could use EC
membership as a device to criticize the Heath government. Moreover,
there was deep opposition to the EC within the Labour Party and labour
movement. Wilson's strategy was to oppose the terms of accession as
negotiated by Heath and pledge a future Labour government to renegotiation
and a referendum. This caused tensions within the Labour Party
at the highest level (most notably, for the Deputy Leader and convinced
pro-European, Roy Jenkins). Wilson's reasoning was that a shift to a
broader public debate could avoid deep Labour Party divisions being
exposed to the public with the result being, as James Callaghan put it,
that the referendum was `a life raft into which one day the whole Party
[might] have to climb' (cited in Forster, 2002a: 303). Labour were
involved in some opportunistic u-turns when one considers their 1967
attempt to secure membership, but the depth of opposition within the
Party made a referendum an attractive proposition. Harold Wilson gave
responsibility for co-ordinating Labour's opposition to the accession
treaty in the House of Commons to the confirmed anti-EC duo of
Michael Foot and Peter Shore. The contrast here with Conservative
Party management is interesting. Heath had marginalized opponents of
the EC and excluded them from the membership negotiations. Labour at
this time had anti-marketeers in senior positions within the government
and involved in discussions at the highest level about Britain's future
in Europe.
After Labour returned to power in February 1974 renegotiation talks
were led by the Foreign Secretary, James Callaghan. Callaghan has been
described by his biographer as emphasizing from the start `his coolness
about the European project and his intention of dissecting it in its
fundamentals'. When officials suggested that there might be some
leeway on the budget and the CAP, Callaghan rebuked them, asking if
they had read the Labour Party manifesto, and stated that if they had then
they would discover that the Labour government's aim was a fundamental
renegotiation of the Treaty of Accession (cited in Morgan, 1997:
412­13). This was hardly likely to go down well with the other member
states. That the Eurosceptic Peter Shore and the pro-European Roy
Hattersley then carried out the detailed discussions may have appeased
Labour's pro- and anti-Common Market brigades, but it baffled other
member states.
Britain in Europe from Heath to Blair 75
Why should other member states accede to British demands? There
were many good reasons why they might find them irritating. After all,
unravelling the complex EU acquis to favour the British might prompt
other member states to seek some compensation too. For instance, if the
British were to get some help with their budget contributions, then why
not the West Germans who were also big contributors?
Britain gained little through the renegotiation that it could not have
gained through normal Community channels. The degree of acrimony
engendered by the bargaining soured Britain's relations with other members
for many years. For what they were worth, the House of Commons
endorsed the renegotiated terms by 396 votes to 170 in April 1975.
Ominously for the Labour government, and despite pro-Community
speeches from both Wilson and Callaghan, a special Labour conference
on 26 April 1975 voted by 3.7 million to 1.9 million to leave the EC.
The pledge to hold a referendum helped Wilson overcome divisions
within the Labour Party. Indeed, it seems likely that this was the referendum's
major purpose. During the referendum campaign of 1975 Wilson
suspended the convention of collective Cabinet responsibility so Cabinet
ministers could speak according to their consciences. The `Yes' campaign
commanded powerful political assets despite opinion polls at the outset
pointing to a `No' vote. It had strong support from Fleet Street and
from influential business interests, which provided a large part of the
1.5 million spent in the quest for an affirmative vote. It also gathered a
powerful coalition of centrist politicians, including Heath, Labour's Roy
Jenkins and the Liberal leader, Jeremy Thorpe. By comparison, the `No'
campaign raised just 133,000. It found itself outgunned and was weakened
by its disparate character: Tony Benn from the left of the Labour
Party formed a decidedly uneasy temporary alliance with right-wingers
such as Enoch Powell. The outcome, on 5 June 1975, was a two to one
vote in favour of continued membership on a 64 per cent turnout (Butler
and Kitzinger, 1976; King, 1977). The anti-EC National Referendum
Campaign soon fizzled out with the rapid disappearance of its 12 regional
offices and 250 local branches (Forster, 2002a: 304).
1976­9: Callaghan's difficulties
In April 1976 James Callaghan succeeded Harold Wilson as Prime
Minister and inherited a Labour Party divided over EC membership.
Labour's rank and file distrusted the EC even though some prominent
Labour politicians, such as Roy Jenkins and Shirley Williams, were keen
76 The European Union and British Politics
advocates of membership. There were two main areas of concern: first,
it was felt that integration into a supranational community would restrict
national sovereignty and the freedom of action of a Labour government;
and second, the EC was seen as a `capitalist club' with market-based
purposes that offered little to working people. Arguments over EC membership
were symptomatic of a creeping malaise within the Labour Party
that saw the leadership frequently at odds with the membership and
which culminated in a grassroots move to the left, with right-wingers
splitting to form the Social Democratic Party (SDP) in January 1981.
In February 1975 the Conservatives replaced Edward Heath as leader
with Margaret Thatcher. Thatcher had opposed the 1975 referendum,
describing it, in a phrase that would come back to haunt her in her Eurosceptical
dotage (when she called for a referendum on the Maastricht
Treaty), as a device for demagogues. She argued for a `Yes' vote on the
grounds that Britain needed to foster economic links with the European
markets on its doorstep.
Callaghan's pragmatism and Atlanticism meant he held no truck with
the lofty rhetoric of European union. He had a poor reputation in EC
circles as a result of his dogged pursuit of national interests during the
British renegotiation, and failed as premier to ease tensions caused by
Britain's entry to the Community.
From March 1977 Callaghan relied on support from the Liberals to
sustain his administration. This support was conditional upon the insertion
of a clause introducing proportional representation as the method of
voting in direct elections to the European Parliament. Such a clause was
duly inserted into the European Assembly Elections Bill of 1977.
However, it provoked a Cabinet revolt and, on a free vote in the House
of Commons, was defeated. It also delayed direct elections, which, to
the irritation of other member states, were put back from 1978 to 1979.
The British Presidency of the EC in the first six months of 1977 did
little to enhance Britain's reputation. Callaghan was hamstrung by a
Eurosceptical party and by domestic economic problems. In a letter to
the General Secretary of the Labour Party at the start of the British
Presidency, he outlined three basic principles that informed the Labour
government's stance on the EC:
 maintenance of the authority of EC nation states and national parliaments,
with no increase in the powers of the European Parliament
 emphasis on the necessity for national governments to achieve their
own economic, regional and industrial objectives
 reform of the budget procedure.
Britain in Europe from Heath to Blair 77
Contained within these policy principles is a clear restatement of
Britain's suspicion of supranationalism and continued concern over the
high level of budget contributions. Margaret Thatcher shared these concerns
when she became Prime Minister in May 1979. Thus while she
became well known for battling for a budget rebate and opposing extensions
of supranational authority, Britain's reputation as an awkward
partner both preceded and survived her.
British membership of the EC was advocated on pragmatic economic
grounds. Many British people seemed to think that they were joining a
Common Market ­ an economic organization that was little more than
a glorified free trade area ­ although the political intent of the European
Community had been clear since its foundation in the 1950s. The idea that
the EC was essentially designed as a glorified free trade area was not true.
Suffice to recall that Britain's alternative to the EC in the form of EFTA
was just such an organization, but this largely failed. Yet the pragmatic
acceptance of membership by Britain and the understanding propagated
by some of the original purposes of the `Common Market' mean that
Britain has tended to judge the EC by utilitarian standards: what does it
have to pay and what does it get out of it? Britain was paying a lot in the
late 1970s and early 1980s and seemed to be getting little in return.
Not surprisingly, enthusiasm for the EC did not run deep.
1979­84: the budget rebate
When Margaret Thatcher took office in 1979, the Conservatives were
seen as a pro-European party. In her 1981 speech to the Conservative
Party conference Thatcher reflected on British membership of the EC
and noted that:
it is vital that we get it right. Forty-three out of every hundred pounds
that we earn abroad comes from the Common Market. Over two million
jobs depend on our trade with Europe, two million jobs which will be
put at risk by Britain's withdrawal [Labour's policy at the time]. And
even if we kept two thirds of our trade with the Common Market after
we had flounced out ­ and that is pretty optimistic ­ there would be
a million more to join the dole queues. (Harris, 1997: 147)
But Thatcher's pro-Europeanism was distinct from that of her predecessor,
Heath. While Heath `lived and breathed the air of Europe', Thatcher tended
to depict European unity as desirable in terms of anti-Soviet policy
78 The European Union and British Politics
(H. Young, 1989: 184). From the mid-1980s onwards, Thatcher began to
take a more populist line on Europe and viewed the EC, its institutions and
other European leaders with much suspicion (see Chapter 9 for more
discussion of Euroscepticism).
Europe was, however, not a central political theme of the first two
Thatcher governments (1979­83 and 1983­7), which focused on domestic
economic policy and external events such as the miners' strike, the
Falklands War (1982­3) and the US bombing of Libya (1986). Probably
the most pressing issue was the British contribution to the EC budget.
By the end of the 1970s Britain was the second largest contributor to
the budget and was in danger of becoming the largest, paying over
1 billion a year, even though it had the third-lowest GDP per capita of
the nine member states.
A series of often acrimonious negotiations ­ `patient' and `a little
impatient diplomacy' as Thatcher put it in her speech to the 1984
Conservative Party conference ­ were held between 1979 and 1984. The
then Commission President, Roy Jenkins, writes in his memoirs of long
hours spent discussing the BBQ: the British Budget Question (or, as he
preferred to put it, the Bloody British Question). He notes how Thatcher
made a bad start at the Strasbourg Summit in 1979 when she had a
strong case but succeeded in alienating other leaders whose support she
needed if a deal were to be struck. Britain's partners in the Community
were unwilling to receive lectures on the issue from Thatcher and were
alienated by suggestions that the budget mechanisms were tantamount to
theft of British money, particularly as Britain had known the budgetary
implications when it had joined (Jenkins, 1991: 495). The issue was
finally resolved at the Fontainebleau summit in June 1984 when a rebate
was agreed amounting to 66 per cent of the difference between Britain's
value added tax (VAT) contributions to the budget and its receipts. The
next chapter shows that the UK remains the second largest contributor to
the EU budget, behind Germany.
The Fontainebleau agreement was important as it meant that EC leaders
could lift their sights from interminable squabbles over the budget and
begin to think strategically about the future of the Community. `More
generally, the resolution of this dispute meant that the Community could
now press ahead with the enlargement [to Portugal and Spain] and with the
Single Market measures which I wanted to see', as Thatcher put it
(Thatcher, 1993: 545). The British government's preferences had been
clearly stated in a paper, entitled `Europe: The Future', circulated at the
Fontainebleau summit (HM Government, 1984). The paper called for the
attainment by 1990 of a single market within which goods, services, people
Britain in Europe from Heath to Blair 79
and capital could move freely. It very clearly reflected the deregulatory zeal
that Thatcher brought to domestic politics. The legacy of these ideas about
deregulation and liberalization have also been strongly felt in British government
preferences towards European integration in the administrations
that have come since Margaret Thatcher left office in 1990. Buller (2000)
argues that the single market project was seen as a way of enshrining core
Thatcherite principles at EC level. The fact that this Thatcherite vision of a
liberalized, deregulated EC was not widely accepted by other member
states can help explain the development of Conservative Euroscepticism in
the late 1980s and through the 1990s.
There is another point here too. Thatcherism also changed the rules of
the game of domestic economic and social policy and shifted ideas about
the respective roles of the state and market. Even though they may not
have been widely accepted at EU level they have had major effects on
British domestic politics with implications that can be traced through
to current dilemmas, such as New Labour's position on replacing the
pound with the Euro.
1984­7: towards the single market
In Britain Thatcher had sought to `roll back the frontiers of the state' and
allow free enterprise and market forces to flourish. Thatcherism embodied
what has been characterized as the amalgam of the free economy and
the strong state (Gamble, 1988). For Thatcherites the EC was a stultifying
bureaucracy that could do with a dose of Thatcherite free market
vigour, whether it liked it or not.
In order to secure the single market promoted in the Fontainebleau
paper Britain needed allies amongst its EC partners. There were
potential allies at both the national and supranational level, as shown
below:
1 The two key member states, France and West Germany, were
amenable to single market reforms. The French Socialist government
elected in 1981 had abandoned its reflationary economic policies in
1983 (under the then Finance Minister, Jacques Delors), and the
Christian Democrat-led coalition of Chancellor Kohl in West
Germany supported the creation of a single market
2 The new Commission President, Jacques Delors, took office in 1985
and seized upon the single market as his `big idea' to restart integration
and shake off the `Eurosclerosis' of the 1970s and early 1980s.
80 The European Union and British Politics
The Commissioner responsible for the internal market, the former
Conservative Cabinet minister, Lord Cockfield, assisted Delors in
his ambitions.
A White Paper prepared by the Commission put forward 300 legislative
proposals for the single market. These were later whittled down to
282. Heads of government at the Milan summit in June 1985 accepted
the proposals. In the face of objections from the Danes, Greeks and
British, an intergovernmental conference was convened to consider
reform of the EC's decision-making process to accompany the single
market plan.
Whilst Britain was hostile to strengthening Community institutions,
France and West Germany asserted that attainment of the single market in
fact necessitated increased powers for supranational institutions such as
the European Parliament in order to ensure that decision-making
efficiency and a measure of democratic accountability followed the
transfer of authority to the supranational level. The British did not see it
that way and thought the single market could be achieved without reform
of the EC's institutions. In her memoirs, Thatcher recalled that, `it would
have been better if, as I had wanted originally, there had been no IGC
[intergovernmental conference], no new treaty and just some limited
practical arrangements'. The British government compromised on some
issues such as increased use of qualified majority voting in order to secure
more prized single market objectives. The resultant Single European Act
(SEA) had three main features (the first of which was actively supported
by the British government, while the latter two were not):
1 Establishment of a target date, the end of 1992, for completion of the
internal market and attainment of the `four freedoms': freedom of
movement of people, goods, services and capital.
2 Strengthening of EC institutional structures, with qualified majority
voting (QMV) introduced in the Council of Ministers to cover new policy
areas relating to harmonization measures necessary to achieve the
single market. Increased use of QMV ensured swifter decision-making.
Unanimity was still required for fiscal policy, the free movement of
persons and employees' rights legislation. The European Parliament's
role was strengthened by introduction of the `co-operation procedure',
which gave power to suggest amendments to Community legislation.
The Council retained the right to reject Parliament's amendments.
3 A new chapter of the Treaty was added covering `Social and Economic
Cohesion'.
Britain in Europe from Heath to Blair 81
The Thatcherite vision was of a limited `regulatory' European state
(as discussed in Chapter 3) within which the role of European institutions
would be to police the single market without becoming involved in
the core allocative and distributive questions that would remain largely
the concern of national governments and market forces. The
Commission's White Paper put forward by the Commission identified
three kinds of barriers to trade that needed to come down if the single
market was to be attained:
 physical barriers (mainly customs and border controls)
 fiscal barriers (indirect taxes vary in the Community and constitute a
barrier to trade)
 technical barriers; these were very significant because member states
had developed their own product standards which differed widely
and formed a substantial barrier to free trade.
The single market programme and ideas about what it should involve
provided a backdrop for Conservative Euroscepticism. For Thatcherites,
the single market was an end in itself that could raise to a European stage
the liberalizing and deregulatory elements of the Thatcherite project. For
many other member states, the SEA was a means to an end, that end
being deeper economic and political integration with the EC taking a
bigger role in flanking areas such as social and regional policy, while
also moving towards far more ambitious projects such as economic and
monetary union. This gap between many other member states and the
Thatcher governments centred on the respective roles of the state and
market. This gap grew in the 1990s because of the acceptance among
Eurosceptics that European integration would bring with it Brusselsimposed
re-regulation of the UK economy.
1987­90: Thatcher's last hurrah
The final years of Margaret Thatcher's premiership were characterized
by an almost incessant battle against spillover effects generated by the
SEA. For the French and Germans, who had been key single market
allies, adoption of a plan to complete the single market was a new beginning
for integration. They sought to consolidate the success of the SEA
by promoting integration in other areas. Plans were hatched for EMU
and for Community social policies to ensure minimum rights for workers
in the wake of the freedoms given to capital by the SEA.
82 The European Union and British Politics
Thatcher firmly set herself against the integrative consequences of the
SEA. This was particularly evident in her response to questioning in the
House of Commons following the Berlin summit meeting of EU heads
of government in October 1990. During her responses, she departed
from the pre-arranged and carefully worded text to launch into an attack
on the integrative ambitions of other EC member states and the docility
in front of this threat (as she saw it) of the opposition Labour Party.
A section of Thatcher's response is cited below:
Yes, the Commission wants to increase its powers. Yes, it is a nonelected
body and I do not want the Commission to increase its powers
at the expense of the House, so of course we differ. The President of the
Commission, Mr. Delors, said at a press conference the other day that
he wanted the European Parliament to be the democratic body of
the Community, he wanted the Commission to be the Executive and he
wanted the Council of Ministers to be the Senate. No. No. No.
Perhaps the Labour party would give all those things up easily.
Perhaps it would agree to a single currency and abolition of the pound
sterling. Perhaps, being totally incompetent in monetary matters, it
would be only too delighted to hand over full responsibility to a
central bank, as it did to the IMF. The fact is that the Labour party has
no competence on money and no competence on the economy ­ so,
yes, the right hon. Gentleman [referring to opposition leader Neil
Kinnock] would be glad to hand it all over. What is the point of
trying to get elected to Parliament only to hand over sterling and
the powers of this House to Europe? (Hansard, Vol. 178, Col. 869,
30 October 1990)
This statement exposed divisions within the Conservative Party and
was the breaking point for the Leader of the House of Commons (as well
as the ex-Chancellor of the Exchequer and Foreign Secretary), Sir
Geoffrey Howe. Moreover, as the Conservatives languished in the
opinion polls in 1990 and the disastrous `poll tax' prompted massive civil
disobedience across the country, many Conservative MPs began to see
Margaret Thatcher as an electoral liability (Watkins, 1991). The final
straw for Howe was Thatcher's response to questioning after the Berlin
summit. He resigned from the cabinet and used his resignation statement
to bitterly criticize her leadership style. Howe's speech was the beginning
of the end for Thatcher's premiership. Howe (1995: 667) stated that
`the Prime Minister's perceived attitude towards Europe is running
increasingly serious risks for the future of our nation. It risks minimizing
Britain in Europe from Heath to Blair 83
our influence and maximizing once again our chances of being once
again shut out.' Howe's statement prompted the long-standing opponent
of Thatcherism, Michael Heseltine, to launch a leadership challenge,
although he was deeply unpopular amongst many Conservative MPs who
remained attached to Thatcherite ideas, even if the lady herself had left
office. This allowed John Major to come through the middle as the candidate
who would maintain the Thatcher legacy while bringing a more
emollient style to government and international relations, or at least that
was the thinking of many Conservative MPs. Major was perceived as the
inheritor of the Thatcherite mantle, not least by Thatcher herself. Major
had enjoyed a rapid ascent of the government hierarchy, including a
remarkably brief stint as Foreign Secretary (July ­ October 1989), but his
views on Europe were unclear. They remained so for much of his
premiership.
1990­3: Major, the Exchange Rate Mechanism and Maastricht
Within the EC John Major adopted a more conciliatory tone than his
predecessor and expressed the intention of placing Britain `at the heart
of Europe'. In particular there was an attempt to improve relations with
Germany that had become frosty, not least because of a seminar organized
by the Prime Minister at her country residence, Chequers, to
`analyse' the German character. In a summary of the meeting that was
strongly disputed by many of the participants (see, for example, Urban,
1996), the following were identified in the minutes of the meeting as
aspects of the German character: `angst, aggressiveness, assertiveness,
bullying, egotism, inferiority complex, sentimentality', accompanied
by `a capacity for excess' and `a tendency to over-estimate their own
strengths and capabilities' (Urban, 1996: 151). These conclusions,
drafted by Thatcher's foreign policy adviser, Charles Powell, outraged
many of those present who had actually focused during the meeting on
the remarkable transformation and stability of the Federal Republic.
Much of the fear among Conservative Eurosceptics was based on the
power of the German economy and reunified Germany's key role as the
largest EU member state. This was the sub-text for development of
the plan for EMU in the late 1980s. France, in particular, was a keen
advocate of EMU because it was seen as securing Germany within the
EU and thus, as Chancellor Kohl once put it, giving Germany a
European roof rather than Europe a German one. The British
Conservative government was deeply divided about the plan for EMU
84 The European Union and British Politics
and its forerunners, the European Monetary System (EMS) and the
ERM. Thatcher was growing more sceptical about European integration
and opposed EMU as a threat to national sovereignty, while her Foreign
Secretary Howe and Chancellor Lawson supported ERM membership.
At the June 1989 Madrid summit Thatcher was pressured by her
Chancellor, Nigel Lawson, and her Foreign Secretary, Sir Geoffrey
Howe, to set a date for ERM membership. She resisted, but was forced
to set a series of conditions that were to be met if Britain was to sign up
to ERM (although these were not met when the UK did join a year later).
Chancellor Lawson saw ERM as strongly related to domestic antiinflationary
policy. As he put it in his resignation statement to the House
of Commons on 31 October 1989:
Full UK membership of the EMS ... would signally enhance the
credibility of our anti-inflationary resolve in general and the role of
exchange rate discipline in particular ... there is also a vital political
dimension ... I have little doubt that we [Britain] will not be able to
exert ... influence effectively and successfully provide ... leadership,
as long as we remain outside. (cited in Balls, 2002)
Lawson and Howe both left their high offices for reasons linked to
these divisions over Britain and Europe, but their successors (Major in
the Treasury and Douglas Hurd in the Foreign Office) were equally
strong advocates of British participation in the ERM. By June 1990
Thatcher was forced to concede because, as she put it in her memoirs,
`I had too few allies left to resist and win the day' (Thatcher, 1993:
772). ERM membership tied sterling to the Deutschmark at a rate of 1
to DM2.95 and required market interventions to maintain exchange rate
parities at levels 6 per cent below or above this central rate. A crucial
reason for membership was the attainment of domestic economic
objectives and to add external credibility to anti-inflationary policies.
The downside was that it was far from clear that these external
commitments would tally with the domestic economic situation. There
was little direct evidence to suggest that the ERM would necessarily
bring stability. Moreover, the enormous economic consequences of
German reunification and subsequent high German interest rates could
well place unsustainable pressure on sterling's ERM parities. While
German interest rates remained high then so too would British interest
rates, even though the UK economy was struggling to emerge from
recession and required lower interest rates. Stephens (1996: 259) argues
that the main mistake was `the elevation of exchange rate parity into
Britain in Europe from Heath to Blair 85
a badge of pride ... ensuring that when defeat came it was devastating'.
As will be discussed in Chapters 7 and 9, the ERM fiasco was to shatter
the reputation of the Conservative Party for economic competence
and impel Tory Eurosceptic rebellion (see Chapter 9).
Major also faced the issue of the IGCs convened to discuss deeper
economic and political integration. Despite Major's softer style there
were within the British government's negotiating position at Maastricht
in December 1991 a number of continuities linking Thatcher and Major:
1 An opt-out from the Social Chapter. The Secretary of State for
Employment, Michael Howard, had said that he would resign if the
Social Chapter were accepted (Lamont, 1997: 133).
2 The right for the British Parliament to decide whether Britain would
enter the third stage of the plan for EMU when a single currency
would be introduced.
3 Promotion of the notion of subsidiarity which, in the eyes of the
Conservative government, was a way of reinforcing national perspectives
on Community decision-making.
4 Advocacy of intergovernmental co-operation rather than supranational
integration as the basis of cohesion in foreign, defence and interior
policy. Intergovernmental `pillars' were incorporated into the
Maastricht Treaty.
Unconstrained by high office, Thatcher remarked that she would
never have signed the Maastricht Treaty. However, the treaty Major
negotiated and signed could be seen as reflecting inherited policy
preferences. In addition, Major also reaped the integrative whirlwind
which Thatcher had helped initiate when she signed the SEA in 1986.
Major's deal at Maastricht temporarily assuaged Tory divisions over
Europe and helped lay the foundations for his April 1992 general election
victory. A conspicuous feature of the election campaign was lack of
debate about Britain's place in the EU. Both Conservative and Labour
Party managers knew their parties to be divided on the issue, and tacitly
conspired to keep silent about it. Eurosceptics were thus not entirely
unjustified in later complaining that the British people had not in fact
endorsed Maastricht at the 1992 general election, and that they should
therefore be allowed a referendum on the issue.
Safely returned to government, Conservative divisions over Europe
could no longer be hidden and were to be exposed by a series of calamities
in the summer and autumn of 1992 (analysed more fully in Chapter 9).
An important point in relation to the Europe in Britain theme is that the
86 The European Union and British Politics
Major government was hamstrung by domestic divisions and unable to
formulate either a clear or effective policy towards European integration.
Major had to straddle the pro- and anti-EU wings of his Party and was
unable to provide strong leadership. Thus while there were clear continuities
in British preferences (intergovernmentalism and free trade with a
Thatcherite twist) the capacity to achieve these preferences was chronically
undermined by domestic political turmoil within the Conservative Party.
Other member states became rather like rubberneckers observing a car
accident: they would slow down and swerve to avoid the wreckage, but
would continue with their own journey towards ambitious forms of
economic and political integration. The Britain in Europe and Europe in
Britain themes were connected by a rudderless government pre-occupied
with domestic divisions, a series of setpiece confrontations (such as the
Ioannina compromise) at which Major would draw a `line in the sand'only
to see it swiftly washed away, and Britain weakened in Europe because not
only did it fail to articulate a clear line, but also because fundamental questions
about British membership were being asked.
Chapter 9 discusses more fully the ways in which a determined band
of Eurosceptics frequently defied the government by calling for a referendum
on Maastricht and trying to block the passage of the Maastricht
Bill through the House of Commons. Major was forced into a complex
balancing act because he also had pro-European cabinet ministers such
as Kenneth Clarke and Michael Heseltine in prominent government
roles. The Eurosceptics' rebellion culminated in July 1993 when they
contributed to a government defeat on a Labour amendment incorporating
the Social Chapter into the Maastricht Treaty. This was a mischievous
move by the Tory Euro-rebels who hated the Social Chapter, but
loathed the Maastricht Treaty even more. Major's response was to `go
nuclear' and turn the issue of Maastricht into one of confidence in the
government. In the face of near-certain defeat in a general election and
the return of a pro-European Labour government, most of the Tory
rebels returned to the party fold. This did little to ease divisions within
the Conservative Party, which reached into the cabinet. For a participant's
insight into the in-fighting, loathing, bitterness and acrimony that
descended on the Conservative Party, see Gardiner (1999).
During the 1997 general election campaign, the deep divisions within
the Conservative Party became all too evident. Even government ministers
distanced themselves from the Party's policy to `negotiate and decide'
(more commonly known as `wait and see') on EMU. Major felt powerless
to dismiss the dissenting ministers because of the effects he feared such
action would have on an already damaged Party (Geddes, 1997). In 1992,
Britain in Europe from Heath to Blair 87
after Major had left the Maastricht negotiating chamber, one of his advisers
unwisely claimed `game, set and match' for Britain. With hindsight, this
appears a rather rash judgement. Instead, the Maastricht deal lit the blue
touch paper beneath the Conservative Party, which ignited to cause civil
war within the Party and played an important part in Labour's landslide
victories of 1997 and 2001.
`Modernization' under New Labour
Philip Stephens (2001: 67) has argued that while Tony Blair ­ `the most
instinctively pro-European Prime Minister since Edward Heath' ­ has
been able to make Britain's case in Europe he has been unable to make
the case for Europe in Britain. This remains a core dilemma for New
Labour which is best represented by equivocation on the Euro.
In a speech delivered (in French) to the French National Assembly in
October 1998, Blair noted that his first ever vote had been cast in favour
of Britain's EC membership in the June 1975 referendum (although in
1983 he stood as a candidate for a Party committed to withdrawal). In
government after 1997 Blair could expect far fewer EU-related problems
than his predecessor because of his crushing parliamentary majority. To
this advantage can be added the conversion to the merits of European
integration experienced by many within the Labour Party and labour
movement since 1983. Yet controversial and potentially divisive issues
still linger, particularly on the question of the Euro. Moreover, a key
victory for Eurosceptic campaigning was to ensure that the debate on the
Euro would not just be for MPs, but that any decision to join would
depend on a referendum. This takes a key EU issue beyond the realm of
the House of Commons and the grasp of the party managers and
places it in the public arena with all the associated uncertainties that this
can bring.
The key point with regards to Labour's position on the EU is the transition
from outright advocacy of withdrawal in 1983 to its current, more
pro-EU position. Labour fought the 1983 election on the basis of a
manifesto that developed an Alternative Economic Strategy for the UK
that would involve large scale state intervention and controls over the
economy. These were incompatible with continued EC membership. By
the end of the 1980s, it was possible to argue that Labour was the more
pro-European of the two main parties. Two factors explain the shift, one
ideological and the other strategic. In ideological terms Labour underwent
a dramatic shift in its EU policy after the catastrophic 1983 defeat.
88 The European Union and British Politics
The new party leader, Neil Kinnock, had been a staunch and eloquent
left-wing opponent of the EC throughout the 1970s. He was now to begin
a personal and political odyssey that would see him advocate the `modernization'
of the Labour Party, endorse positive engagement with the EC,
and conclude with him moving to Brussels to become a European
Commissioner. Almost as soon as Kinnock became party leader the commitment
to outright withdrawal was watered down to a commitment to
withdraw if satisfactory renegotiated terms could not be secured.
By the 1989 European Parliament elections, Labour was advocating
active engagement with the EC at a time when the Conservative
Euroscepticism was beginning to emerge in the late 1980s. The intellectual
ballast for this pro-European ideology was provided by examples
taken from other EU member states (particularly West Germany), whose
economies and social welfare systems had performed better than the UK
and who offered the prospect of a more consensual form of capitalism
with a stronger emphasis on welfare and social protection. Labour's
modernization in its early stages was thus linked to mainstream aspects
of European social democracy. This domestic ideological shift was reinforced
by supranational developments that saw the EC develop its
`social dimension'. No longer could the EC be passed off as a capitalist
club that offered little to working people. Indeed, Thatcher's strong
opposition to the social dimension sustained the left-wing view that
perhaps Europe really could offer new opportunities for progressive
politics (at least on the basis that my enemy's enemy is my friend). This
was particularly so for the beleaguered trade unions that Thatcher
labelled as the enemy within and that experienced a legislative onslaught
through new employment legislation. European integration's opportunities
for trade unions was a point made by the Commission President,
Jacques Delors, in a 1988 speech to the TUC annual conference, much
to Thatcher's annoyance as she was not happy to see the Commission
President being so supportive of her opponents (Rosamond, 1998).
The second reason for Labour's shift to a more pro-European stance
is linked to the strategic concerns of an opposition party facing a
government that was becoming, as the 1980s progressed, more vocal in
its opposition to European integration. The case for European integration
had been a powerful feature of the political centre ground in British
politics with a broad measure of agreement between centrist elements in
all three main parties that Britain's place was within the EC. As the
Conservatives appeared to abandon this centre ground then Labour
could occupy it (facilitated by the ideological shifts outlined above) and
portray themselves as a reinvented, moderate and mainstream party that
Britain in Europe from Heath to Blair 89
had ditched the extremist policies which had been damaging in 1983.
To be European was to be modern and to be modern was to be European.
This reorientation would suggest that the New Labour government
elected in 1997 and re-elected in 2001 with overwhelming majorities
would be more positive in its European policies. There were early signs that
it might be. Tony Blair announced a new era of constructive engagement,
while The Observer newspaper felt moved to herald the New Labour
approach to foreign policy with the headline `Goodbye Xenophobia'. The
Labour government announced that it would sign up to the Social Chapter
while the negotiation of the Amsterdam Treaty in June 1997 indicated both
a new and more open British government approach (certainly when
compared to the disastrous final years of the Major administration). This
was marked by acceptance of both legislative and institutional changes
such as the addition of a new employment chapter to the Treaty, the inclusion
of a new Article 13 within the Treaty that greatly extended the antidiscrimination
measures, as well as agreement to increase the use of QMV
and bolster the role of the European Parliament. On a personal level, Blair
seemed much more comfortable with other European leaders than his two
Conservative predecessors.
It is, however, also possible to detect some continuity in New
Labour's EU policy. For instance, the Amsterdam negotiations saw the
UK government maintain a consistent line with that pursued by its predecessors
on border controls, CAP reform and the role of NATO (Hughes
and Smith, 1998; Fella, 2002). New Labour also hedged its bets on the
Euro. Furthermore, as New Labour's enthusiasm for the German model
of social capitalism faded then that of Blair and Gordon Brown at the
Treasury seemed to grow for US-style market liberalization. Divisions
became apparent between Blair's `third way' and European social
democracy (Clift, 2000; Gamble and Kelly, 2000).
Elements of continuity are also apparent. The first is the preference
for intergovernmentalism and the maintenance of links with the USA.
New Labour expounds a vision of Europe that enshrines the central role
of the nation state as the key building block of international politics.
The fact that New Labour sees the EU as a union of sovereign states
is consistent with the attitudes of previous British governments. This
combines with a continued emphasis on transatlantic ties and the
UK's self-positioning as the USA's closest ally in Europe. These Atlantic
ties came under close scrutiny during and after the war in Iraq when
a serious division emerged between Britain and France. The status of
the USA as the world's only superpower, combined with the neoconservative
foreign policies of the Bush administration and fears of US
90 The European Union and British Politics
unilateralism, led to real tensions in the US­European alliance (Kagan,
2002). In a speech to the Foreign Office conference of British
Ambassadors on 7 January 2003, Blair (2003) stated what the principles
of British foreign policy should be:
First, we should remain the closest ally of the US, and as allies influence
them to continue broadening their agenda. We are the ally of the US not
because they are powerful, but because we share their values. I am not
surprised by anti-Americanism; but it is a foolish indulgence. For all
their faults and all nations have them, the US are a force for good;
they have liberal and democratic traditions of which any nation can be
proud ... it is massively in our self-interest to remain close allies. Bluntly
there are not many countries who wouldn't wish for the same relationship
as we have with the US and that includes most of the ones most
critical of it in public.
Blair then added that:
Britain must be at the centre of Europe. By 2004, the EU will consist
of 25 nations. In time others including Turkey will join. It will be the
largest market in the world. It will be the most integrated political
union between nations. It will only grow in power. To separate
ourselves from it would be madness. If we are in, we should be in
whole-heartedly. That must include, provided the economic conditions
are right, membership of the single currency. For 50 years we have
hesitated over Europe. It has never profited us. And there is no greater
error in international politics than to believe that strong in Europe
means weaker with the US. The roles reinforce each other. What is
more there can be no international consensus unless Europe and the
US stand together. Whenever they are divided, the forces of progress,
the values of liberty and democracy, the requirements of security and
peace, suffer. We can indeed help to be a bridge between the US
and Europe and such understanding is always needed. Europe should
partner the US not be its rival.
This intention to be a bridge illustrates the ways in which British
politics remains between Europe and the USA (Gamble, 2003). The gap
between Europe and the USA became more difficult to bridge in the runup
to, and aftermath of, the invasion of Iraq when major divisions
emerged between the UK and the French and German governments.
Tony Blair showed himself to be at least, if not more, pro-US than any
Britain in Europe from Heath to Blair 91
of his post-war predecessors in Number 10 Downing Street, and this
indicates strong transatlantic continuities in British foreign policy.
The second element of New Labour's approach to the EU is linked to
the UK's socio-economic model and those in other EU member states (as
well as the nascent EU approach). New Labour can be understood as
`open regionalists' (Baker, Gamble and Ludlam, 2002) in the sense that
the majority of Labour MPs believe that economic and social objectives
can best be attained within the framework of the EU and within a
competitive and fair European economy. This reflects a re-evaluation of
Party commitments undertaken when Kinnock and John Smith were the
Party leaders. But there is another, `third way' element of open regionalism
as `part of the means by which the party claims to be navigating
between the polar opposites of old-style social democratic collectivism
and neo-liberalism'with key importance attached to market liberalization
as the basis for British full-hearted participation (Heffernan, 2002).
Europe needs to become a little more British if Britain is to become fully
engaged with it. Thatcher believed that the EC required a healthy dose of
Thatcherism, whether it liked it or not. The fact that other member states
baulked at this prescription then became a basis for Conservative hostility
to European integration. New Labour now argue that participation in
deeper integration depends on other member states `modernizing' their
economies and social welfare systems. Without these changes then the
chances of New Labour endorsing membership of the Euro recede. New
Labour are leading advocates of a European economic reform agenda that
seeks more flexible and dynamic labour markets (HM Treasury 2001).
Moreover, the adoption of economic reforms that mirror those that
have been introduced in the UK has become a core component of the
Treasury's evaluation of whether adoption of the Euro would be in
Britain's interests. New Labour's commitment to Europe is conditional in
the sense that it requires adaptation by other EU member states, although
(as was the case with Thatcher) it is not necessarily clear why British
strictures will be accepted by other member states.
British pragmatism in Europe
This chapter has examined the preferences and motivation of British
governments, their capacity to attain these objectives and the reasons for
the shifts in these preferences that have occurred over time. The chapter
has sought to develop the `Britain in Europe'theme through examination
of Britain's relations with developing structures of EU governance while
92 The European Union and British Politics
also broaching the issue of `Europe in Britain' and the ways in which
European integration has been absorbed as part of the organizational and
ideological logic of British politics (a theme which will be developed
more fully in later chapters). It has been shown that there are strong
elements of continuity marked by continued preference for intergovernmental
co-operation, the view that the nation state should remain the
central unit within the EU and that the Atlantic partnership should
remain a core element of the UK's international identity.
There have also been important shifts too. The Conservatives went
from being a pro-European integration party, albeit based on a pragmatic
acceptance of the EC as good for business to a hostility towards European
integration that was strongly based on the Thatcherite legacy. Labour also
fundamentally re-evaluated its stance on European integration and
moved from advocacy of outright withdrawal in the early 1980s to a prointegration
stance by the early 1990s. Yet even this apparent shift from
Conservative hostility to Labour pro-Europeanism contains some
elements of continuity. Thatcherite Euroscepticism was informed at least
in part by dismay that other EC member states were unprepared to accept
Thatcherite strictures and that, for these other member states, the single
market was a means to an end (that end being deeper economic and political
integration) rather than an end in itself (i.e., Thatcherite deregulation
and liberalization). New Labour too ­ following a brief flirtation with
European social democracy ­ have defined their relationship to core EU
economic objectives around the attainment by the EU of certain economic
reform prerequisites. If these are satisfied then New Labour is
prepared to engage with important developments such as EMU.
New Labour, then, has maintained a long-standing British preference for
conditional engagement with the EU.
Britain in Europe from Heath to Blair 93