On Friday 29 November, I went with other members of the Luxembourgish Youth Parliament to a meeting with the Honourable Alice Walpole, UK ambassador to Luxembourg. The topics discussed included the UK-EU relationship and the bilateral relationship between Luxembourg and the UK. Here is a summary of the ambassador’s speech and answers to some questions.
About understanding the UK relationship with the rest of the EU
To understand this relationship, newspapers must not be trusted. Every country has a domestic discussion about its relationship with the rest of the EU. In other countries such as Denmark and Greece, the language makes that no one understands and reads their newspapers outside the respective country. On the contrary, people can read British newspapers around the world. Most international readers do not know what political side a given newspaper defends, so they get a distorted view of British thinking about the EU.
In addition, it is true that there is an island mentality in the UK. Indeed, you have to cross the sea to visit any other country. But the UK nevertheless got involved in the world wars which both started as continental wars. Some Member States invest more in their EU friendships; the UK also invests in friendship with its former colonies, and you can have as many friends as you like!
The British view on the EU’s role: small government
The UK and Nordic countries has a different sort of model of running the State than France and southern European countries. In the latter group, the State played a much bigger role and there were many low-educated people for a longer time. The State told people what to do instead of creating incentives.
The EU architecture seems strange to the UK… The EU system is slowly becoming more similar to the UK. Eastern countries, because of their communist past, are eager to have a small government. The EU is a big mechanism. In countries like France, this looks familiar: people expect a lot from the State and pay a lot of taxes. On the contrary, the UK tries to make the European administration look more like the UK civil service. Currently, the UK is pursuing an austerity policy and is worried that the EU institutions do not try hard enough to save money.
Euroscepticism is mostly political posturing and will not succeed
The EU is often used as a scapegoat in domestic politics. When the French voted “No” in 2005, they voted so because they did not like their government. When people in the UK say in local politics that they are going to vote for the UKIP, they do not support the UKIP’s ideas but they express their anger with the government. Every minister from every country pretends that the EU forced him/her to agree to something, but s/he actually voted for this decision.
Political parties in the UK are quite broad. So, people on the right and on the left of a party do not agree on everything. At present, the UKIP’s support mainly consists in people who broke away from the Tories because of the coalition with the Lib-Dems.
The problem with UKIP MEPs is that they are not very present in the European Parliament. They have taken a job to build Europe although they do not believe in it. Nigel Farage says that the UK should leave the EU, but many of his voters at local elections do not agree with him. A lot of Eurosceptic MEPs will lose their seat in May. The general population in the UK is less stupid than the Daily Mail wants readers to believe… British people are very mobile. Anyone who has a job knows the advantage of the EU.
At the Scottish referendum in September 2014, probably around 15% of Scottish people will vote for independence… although in the opinion polls many people say they are undecided. There will be similar figures if there is a referendum in 2017 about leaving the EU.
In sum, you have to see past a lot of posturing.
So, the UK is not really Eurosceptic; it just wants to reshape the EU
There is a lot of drama around the UK-EU relationship, but the businesses know how the EU has made life better for them. The business community in the UK is very supportive of the EU. Older people also are very supportive. Young people are also keen on free movement (for studying and working).
But the UK wants to make the EU work better. What David Cameron said is that, if the Tories get back into power after 2015, they will hold a referendum in 2017 on the EU membership because referendums are an instrument of the British democracy. He thinks the UK will have the time to reshape the EU in the next 3 years. In the British eyes, the EU lacks competitiveness and therefore needs to wake up and be more pro-business. The Eurozone needs to fix up its problems. Moreover, Brussels is seen as “too far” from the citizens.
It is not only the UK that wants it: other Member States have similar views, e.g. the Dutch share many ideas with the UK. Of course, other people and countries have other ideas. Even countries such as France and Luxembourg are thinking about how to reform the EU, though not necessarily in the same direction.
Bilateral issues: is there competition between London and Luxembourg to attract financial services?
Most companies in the financial services sector have an operation in the Eurozone and in London. So, Luxembourg’s main competitors are in the Eurozone, it’s not London.
However, it is worth noting that hiring a mid-ranking employee in the UK is 65% cheaper than in Luxembourg and 25% cheaper than in Belgium. In the UK, it is easy to hire and fire people. This is where Luxembourg is weak: the working costs in Luxembourg are very high.
On the other hand, the UK has a handicap: it is not part of the Schengen area, so non-EU citizens need a visa to go anywhere else in Europe.
Bilateral issues: opportunities for cooperation between Luxembourg and the UK
There are many opportunities for agreements: on financial services, on the digital Single Market, on outward looking activities (e.g., successfully negotiating the TTIP with the USA and other free-trade agreements). In addition, Luxembourg is very committed to international peace and contributes to peacekeeping operations. There is also a close cooperation on Syria and Somalia and on issues coming to the Security Council (and on implementing UN SC decisions to the EU).
Conclusion: reshaping Europe is not more or less Europe, it’s making it different
Being a UK ambassador in any European capital is always a challenge… But British ambassadors are never afraid of being unpopular. Countries that agree with the UK sit quietly behind the UK. Some are happy that the UK takes the “bad role” as a big country. For small countries, it is sometimes very difficult to challenge an EU project.
The European Parliament sometimes plays a role in areas that the UK thinks should be discussed at national level. For example, recently, the Commission produced some draft regulation explaining what kind of shoes and jewellery the hairdressers should be permitted to wear. But in the UK, no one cares about what hairdressers should wear. For the British, the first question always is: is the topic an issue for all 28 Member States? If we have different traditions and ways of handling a problem, it is fine and we do not need to tackle the issue uniformly.