Daniel Kenealy

Britain’s Decision | The EU Referendum

The shape of the UK’s relations with the EU has been defined by its unique historical understanding of its place in the world, writes Daniel Kenealy. He argues that, more recently, the increasing Eurosceptic dimension of the Conservative party and the electoral threat from UKIP combined to make a referendum on membership a likely eventuality.

Diamond Jubilee Preparation, Justin Frisch, CC-BY-NC-ND-2.0

The Long Term: Britain as an Awkward European Partner?

In the aftermath of World War II, the US took a strategic foreign policy decision to underwrite the security of Western Europe. It did this as a result of an altered balance of power. Put simply, the war transformed Europe from the centre of global politics to a component in a new balance of power between the US and the Soviet Union.

Within Europe, France decided, in the early 1950s, to make a bold move. Foreign Minister Robert Schuman proposed a new institution: the European Coal and Steel Community (ECSC), which would place the coal and steel industries of Germany, France and several other European countries under international control.

The aim was to take what were then considered industries essential to warfare and place them beyond the control of any one country. The underpinning idea was to make it less likely that any major European country could ever wage war against another.

Whilst Italy, Belgium, the Netherlands, and Luxembourg were content to join the ECSC, the UK opted to stay out. Within the British government, a combination of factors came together to determine that outcome. In elite circles, there was a strong belief that Britain remained, after World War II, a global power of the first rank, a status that would be compromised by joining new European institutions.

This sense was coupled with a belief that Britain’s rightful role was to serve as a bridge between Europe and the US, and Europe and the Commonwealth, a role that it could only play if it stood aside from European integration. In addition, given that the ECSC did not permit the nationalisation of its members’ coal and steel industries, and that the post-war Labour Government was committed to such nationalisation, it would have been politically difficult for Britain to join.

Britain thus stood on the sidelines as six European countries took the first step towards integration. A few years later, between 1955-1957, those same six countries decided to establish the European Economic Community (EEC), which was a commitment to create a single market in which goods, services, people, and capital moved freely.

This was the start of what today we call the European Union. It was driven by a desire to boost trade and economic growth. Once again, Britain stood aside in 1957, driven largely by an understanding of its role in the world that did not allow it to tie its fortunes too closely to the Continent.

Knocking on the Door

By the early 1960s Britain’s economic growth and foreign direct investment were disappointing compared to the EEC six. As it became clear that we were lagging behind our Continental neighbours, the government changed tack and attempted to join them.

Governments led by both parties – Harold Macmillan’s Conservatives and Harold Wilson’s Labour – tried in vain to secure membership throughout the 1960s. The obstacle was French President Charles De Gaulle who, in an attempt to further his geopolitical aim of French leadership of a larger European bloc in global politics, twice said ‘Non’ to British membership in 1961 and 1967.

Eventually Britain’s persistent knocking on the door of the EEC paid off. De Gaulle had departed the scene and, with the European balance of power shifting clearly and decisively in favour of West Germany, French President Georges Pompidou lifted his country’s opposition to British membership.

Membership was secured on 1 January 1973 under the Conservative government of Edward Heath. But Heath lost power the following year and in 1975, shortly after joining, Britain held its first Europe referendum to decide whether or not it should stay in the EEC.

The result revealed deep splits in the Labour party – then in government under Harold Wilson – but, with the leadership of all main political parties (even Margaret Thatcher’s Conservatives), and all national newspapers backing membership, 67 per cent voted in favour. The vote looked decisive, but in the event did nothing to settle ‘the Europe Question’ in British politics.

Almost from the outset, Britain was an awkward member of the EEC. Immediately upon joining, it sought to renegotiate the amount of money it paid to the EEC and to secure market access for New Zealand dairy products. In the 1980s, then Prime Minister Thatcher began an ongoing battle with the EEC about Britain’s budget contribution, securing the infamous ‘rebate’ to compensate for Britain’s disproportionately low benefit from EEC agricultural subsidies.

Europe and Party Politics

Despite these ‘battles’, the Conservative party was broadly in favour of Britain’s membership throughout the 1980s. There was some Euroscepticism within the party, but Mrs Thatcher was instrumental in the EEC’s biggest leap forward since 1957, the Single European Act of 1986. The Act, which promised to construct a true single market in goods, services, people and capital by 1992, appealed to the market-based instincts of the Conservatives.

The divisions within the Labour party over EEC membership became more pronounced during the later 1970s. During these years, it was the left of the Labour party – led by figures such as Tony Benn and Michael Foot – that voiced the loudest opposition to the EEC.

In 1983, Labour entered the General Election with a campaign commitment to withdrawing. However, once Neil Kinnock had replaced Michael Foot as leader, Labour became more moderate, leading to a party political role reversal by the 1990s, as the Conservative  party grew more Eurosceptic in contrast to their position in the late 1970s and 1980s.

Thatcher quickly turned against the EEC after the passage of the Single European Act. Disturbed by what she saw as a direction of travel towards some form of European super state – with a single currency and a more federal structure – she famous declared ‘No, No, No’ in the House of Commons to plans for further and deeper integration.

Her bête noire during these years was the EEC Commission President Jacques Delors, who himself became a symbol of power-grabbing European officials. The Sun, in November 1990, famously ran the headline ‘Up Yours Delors’.

Just a few weeks, later Thatcher had left office in large part because of major divisions in her party on Europe. John Major, who was more sympathetic to the EEC than she had become by the late 1980s, replaced her. The ‘Europe Question’ would dog his seven-year premiership and he even resigned and put himself up for re-election as Conservative party leader in an attempt to silence the issue.

Although he won that contest in 1995, it revealed a pronounced division within the Conservative party, a division that would grow once the party moved into opposition in 1997. During Major’s premiership, Europe made big strides forward and Britain suffered a major humiliation with the forced exit from the Exchange Rate Mechanism (ERM).

With the 1992 Maastricht Treaty, the EU was born. Although Britain secured opt-outs from the single currency (the euro) and on some social policy legislation, the EU moved forward towards political union.

A More Sympathetic Tone

The years of Labour government under Tony Blair and Gordon Brown saw a very different tone. Both were far more sympathetic to the EU than their Conservative predecessors. Blair signed Britain up for the social policies from which Major had won an opt-out and, along with French President Jacques Chirac, launched the European Security and Defence Policy.

Blair was even happy to consider membership of the euro, but Gordon Brown remained opposed. These were, generally speaking, years of friendlier UK-EU relations, with the UK championing the enlargement of the EU to the former Soviet states.

During thirteen years of Labour government, the party political positions became more concrete. Labour was the major party most firmly committed to Britain’s EU membership. Although most successive Conservative party leaders continued to favour Britain’s membership (at least in public), the party that they led grew more and more Eurosceptic, creating tremendous pressure on those leaders.

The Short Term: A Prime Minister Losing Control?

This growing Euroscepticism within the Conservative party is perhaps the key short-term trigger for the present referendum. Upon becoming leader of the party in 2005, David Cameron moved to withdraw his party’s Members of the European Parliament from the mainstream centre-right party political grouping in Brussels.

This was to win favour amongst the Eurosceptic wing of the party. Over the next decade, Cameron faced pressure from three sources: from within his party, from the British electorate and from developments within the EU itself. All three pushed him in a more Eurosceptic direction and towards his commitment to a referendum.

First, the Conservative party – both at the grassroots level and also in terms of its elected MPs – grew more Eurosceptic. Even those who were not overwhelmingly committed to getting Britain out the EU were keen to see the powers of the EU reduced and the Brussels-based institutions dramatically reformed.

Second, within British politics a new electoral force emerged that posed a clear and present danger to the Conservative party. UKIP, led by the charismatic Nigel Farage, began to gain electoral success with its intensely Eurosceptic message. Farage managed to link fears about immigration and societal change to Britain’s EU membership in a highly effective way. This created a pressure for Cameron to take on, and try to settle, the Europe Question.

Third, the EU itself was hit very hard by the global economic crisis that broke out in late 2008. The result was bailouts for several countries that used the euro, new EU laws and institutions in the areas of banking and finance and the possibility of far deeper integration amongst those EU members in the Eurozone. Calls to ensure that the City of London was protected from EU overreach and that Britain – and other non-euro countries – could not be ganged up on and outvoted by euro countries grew louder.

Those three factors – amongst others – pushed Cameron towards his commitment to renegotiate the terms of Britain’s EU membership, and to negotiate changes to the way the EU works, before holding an ‘in or out’ referendum.

Since becoming party leader in 2005, Cameron has been led by his party on the EU question much more than he has led his party. He has adopted a ‘kick-the-can-down-the-road’ strategy, seeking to postpone the issue for as long as possible. Having won a surprising majority in the 2015 General Election, he could delay no more. He had staked his political legacy on winning a referendum that he did not especially want to have.

Ever an Awkward Partner

Britain’s EU referendum is the product of long- and short-term historical factors. The UK has never been a comfortable member of the EU. Britain stood aside during the early years of European integration, driven by a fundamentally different history to its continental partners, a different experience during World War II and a different idea of its role in the world.

These differences created national stories, which entrenched those differences in what we might call the national mindset. Even after joining the EU in 1973, Britain has been an awkward partner, usually found opting-out of many key developments such as the euro, the Schengen passport-free area and many policies in the area of justice and home affairs. Such a long-term history may have made this referendum in some sense inevitable.

However, in the short term, it is the internal politics of the Conservative party that have driven Britain to this point. A rising Euroscepticism within the party, coupled with the rise of UKIP, and developments within the EU that have pushed Britain into adopting a series of defensive positions, combined to pressure David Cameron into his strategy of ‘renegotiate and referendum’.

Whatever the result on 23 June, Britain’s long and complicated relationship with the continent of Europe looks set to continue. The referendum will not settle Britain’s Europe Question.

This article, co-published with the Centre on Constitutional Change, draws from the e-book Britain’s Decision – Facts and Impartial Analysis for the EU Referendum.

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Daniel Kenealy
University of Edinburgh

Dr Daniel Kenealy is Lecturer in Public Policy and Adviser on University-City Relations to the Senior Vice Principal at the University of Edinburgh. His research interests include political history, devolution, European integration and UK-EU relations.

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