University 18 Yrs + | Britain & Europe

Britain and Europe – The New Labour Governments 1997-2010

Neither Wilson nor Callaghan had any great enthusiasm for Europe and Callaghan was the first politician to express Euroscepticism in terms of opposition to the EU having more powers.

When Labour went into opposition, Michael Foot, who had strongly opposed the European Communities Bill and campaigned for a No in the 1975 referendum, became leader.

The left became dominant in the party and proposed an Alternative Economic Strategy which would have been unachievable within the Treaty of Rome.  The Labour Party Conference in 1980 voted to withdraw from the EU and, with two of the leading pro-Europeans, Roy Jenkins and Shirley Williams, leaving the Labour to form the Social Democrat Party, the policy for the 1983 election was to start negotiations with other member states to draw up a timetable for withdrawal.

Having lost the election badly Labour decided to concentrate on proposals for the reform of the EU instead and, in any case, embarked on a series of reviews of party policy:-

• The 1984 European elections manifesto talked about reforming the Common Agricultural Policy, returning some powers to Britain and reducing the budget contributions. The 1987 general election manifesto said little about Europe but did promise to work constructively with European partners.

• The 1988 Policy Review made significant changes to economic policy with implications for Europe but no major change to European policy as such. However, policies such as those on the environment, and workers’ rights, which Labour supported, now began to come out of Brussels.

• The manifesto for the 1989 European elections was more pro-European than that of the Conservatives and this is the point at which the two parties began to cross over in their European policy. Roy Hattersley as Deputy Leader was clearly pro-European and Labour supported participation in the ERM from 1989.

• John Smith, who was the first pro-European leader of the Labour Party, won the 1992 leadership election against Bryan Gould who was less enthusiastic.  Labour supported all aspects of the Maastricht Treaty. In the 1992-7 Parliament only 7% of the Parliamentary Labour Party were in favour of leaving the EU and these were mostly older MPs.  In the 1994 European elections Labour won 62 of the 87 seats.

• Blair as leader after 1994 was careful not to be too European as there was now the danger of attacks from a Eurosceptic Conservative Party.  He presented the Euro as a largely economic issue and sought to make European policy a matter of who could get the best out of Europe rather than one of principle.

• The 1997 general election manifesto was equally cautious and talked about the national interest and the need for EU reform but also promised a constructive approach. Most significantly it made a commitment to holding a referendum before Britain joined the Euro.

Altering their European Policy

Philip Daniels charts these changes  (West European Politics Vol. 21 No 1, 1998) and gives three main reasons why Labour altered its European policy:-

• Party political competition was important. Labour wanted to create the image of a modern party and reclaim European policy from the Liberal Democrat SDP Alliance (the red rose was adopted to replace the red flag as Labour’s symbol, similar to continental socialist parties). As the Conservatives moved to a more Eurosceptic and divided view, Labour could present itself as the sensible party on Europe while still upholding the national interest against too much European integration.

• Labour increasingly came to accept the interdependence of economies and the difficulty of running a purely national economic policy.   The Socialist Government in France, between 1981 and 1983, was the last to attempt an expansionary domestic policy and ended having to cope with a run on the Franc. Membership of the ERM might allow Labour to claim economic credibility, with the low inflation and an end to sterling crises that it was expected to deliver

• The Trade Union conversion to Europe and the idea of a social Europe had an impact on the Labour Party

To these can be added another factor:-

• The long period of exclusion from power meant that, for Labour, Europe provided the only means of influence and its success in European elections created a group of MEPs, some of whom were later elected for Westminster, who could argue for Europe with the Labour leadership.

The Labour Governments 1997 – 2010

Tony Blair, though not a noted pro-European in the Labour Party, had the most favourable view of Europe of any Prime Minister, except Heath.

He immediately brought Britain within the Social Contract and was positive in the negotiations that led to the Amsterdam Treaty in 1998. The Cabinet Office European Secretariat was enlarged and both ministers and civil servants were encouraged to develop contacts with their equivalents in other member states in order to develop alliances that could help in EU bargaining. Similar links with other socialist parties in Europe were strengthened.

Blair and Robin Cook, the Foreign Secretary, identified defence as a priority area for European cooperation in order to provide an alternative to reliance on the United States, especially after Blair found it difficult to get the Americans to help in Kosovo.

In 1998, Britain signed the St Malo Agreement with France, which stated that Europe had to have a credible military force to intervene in international crises and a mechanism for agreeing when and how to use it. Britain fully supported the creation of the European Security and Defence Policy in 1999 and the European force was used  for the first time in the Macedonian peacekeeping operation in 2003 and, later, in missions such as those in the Democratic Republic of the Congo and against Somali pirates.

Blair’s speech in Warsaw in 2000 was the climax of this period of European involvement, positive without being overly integrationist  (‘Europe a superpower not a superstate’ was a key phrase) and developing the idea of the need for a United States/ Europe foreign policy bridge with Britain playing a leading role.

The whole of the New Labour period of Government, was not one in which a major treaty leading to extensive integration was under discussion.  Some institutional reforms were debated but enlargement to Eastern Europe was the major issue for the EU as a whole.

This suited Britain as it would bring in a group of countries that were pro-American and, given that their politicians had just achieved power, were not keen to hand power over to the EU.  The only exception to this was the Euro.  Blair had committed to a referendum and in 1998, after a landslide election victory and at the height of his popularity, there was probably a window of opportunity to win such a referendum as, although opinion polls showed the public to be against the euro, many people did not hold their views very deeply.

Gordon Brown, the Chancellor of the Exchequer, had been seen as pro-European, but was anxious to exert control over all economic areas without interference from Number 10.  Labour had always argued that joining the Euro would always be made on economic grounds, rather than to help political integration, and Brown, with Ed Balls as his adviser, created five economic conditions before this would take place.

The five tests were very difficult to meet and a review in 2003 concluded that only one had been achieved.  As Euroscepticism increased it became more and more unlikely that a referendum could be won. In the end, neither Blair nor Brown nor Cook, who had been Eurosceptic but became more pro-European in office, were prepared to take the argument to the country and try to win it.  Labour made little effort in the 1999 European elections, turnout sank below 25% and two UKIP MEPs were elected.

Gordon Brown’s Five Tests For Joining The Euro

• Are business cycles and economic structures in the UK economy compatible with those of other member states?  Will the setting of interest rates at a European level cause problems?

• If problems develop in the British economy is there sufficient flexibility in the Eurozone economies to deal with them?

• Will participation in the Euro encourage inward investment into Britain?

• Will the UK’s financial services industry and City firms be able to maintain their competitive edge?

• Will joining the Euro promote higher growth and a lasting increase in jobs?

Blair’s second term in office was dominated by the fight against terrorism and Iraq. Iraq showed the limitations of a European foreign policy.

Although several other countries, including Spain and Italy, supported Blair, with France and Germany against intervention in Iraq, Europe was split.

Blair tried, with the idea of a second UN resolution approving intervention, to be the bridge between Europe and the United States but when this failed he followed the United States instead.

Other problems with European policy developed. Britain’s strategy had been to develop alliances with one country and one issue at a time and this prevented the development of stable relationships.

He looked to promote economic liberalism rather than traditional social democratic concerns and this led him into alliances with the conservative Prime Ministers, Aznar of Spain and Berlusconi of Italy.  Schröder, the German Social Democrat Chancellor, was, for a time, interested in New Labour’s Third Way but, in the end, reverted to traditional social democrat policies.

Peter Hain, the pro-European Minister for Europe, negotiated the creation of the EU Constitution and pretty much achieved what Britain wanted but when it fell, after the Dutch and French referendums, Gordon Brown, now Prime Minister, felt he had to show public opinion in Britain that the Lisbon Treaty was different and made compromises, just as Major had on Lisbon.

Through the New Labour period, British Governments played a positive role in Europe but without providing the leadership that would set Europe off in a new direction or create an alternative to the French-German axis.

(Stephano Fella explains the Government’s position in the various EU negotiations Parliamentary Affairs Vol. 59 No. 4, 2006)