THE SINGLE MARKET PART 2 - THE FOUR FREEDOMS OF THE SINGLE MARKET ARE POLITICALLY A

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Adrian Lloyd
6 years ago
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1 THE SINGLE MARKET PART 2 - THE FOUR FREEDOMS OF THE SINGLE MARKET ARE POLITICALLY A PACKAGE DEAL The four freedoms (goods, services, people and capital) were seen as a package deal when the EU was created, with the strong industrial nations benefiting from exporting their goods, services and companies freely to other EU states, while the poorer nations would send their excess labour to the places which had the jobs, i.e. to the countries with the larger economies. This still holds true today. All EU countries produce goods that benefit from free movement and all countries are keen to allow their citizens the right to move and work in other states. Indeed, around 2.2m British people live in other member states. But the point is that for some member states certain freedoms are more important to their economies than others. Generally speaking the less well off nations are particularly keen on free movement of people, because they tend to have higher unemployment and lower income people.

2 Some euro-sceptics argue that they do not believe Britain can cope with the number of EU migrants. Whether they are right is matter of statistics that I am not able to answer (although almost every independent study has found that EU migrants pay more in taxes than they take out in benefits). But as a matter of policy and law, all countries have the right to the four freedoms but benefit from them to different extents. Because we have a relatively very successful economy, people from those less successful countries with higher unemployment, come to us. Interesting historical point: when the EU took in 10 new eastern and central European states as member nations in 2004, Tony Blair, the then PM, had the option of delaying when the nationals of the new states would be able to exercise their free movement rights. Germany exercised that option for example. He chose not to limit EU migration as he believed the UK needed the labour. However, we used the option for delaying Bulgarian and Romanian migrants when those countries become members a few years later.

3 If we left the EU, and then came to negotiate a treaty of cooperation with the EU, obviously in theory both parties could agree whatever they like (remember what I said above about treaties being essentially like contracts where if all sides agree pretty much anything can be agreed as long as it doesn t breach other rules). To stress the point: BOTH sides have to agree. We in the UK have no right as a matter of law to demand access to the single market minus the free movement of migrants. The danger of leaving the Union and then asking for access to the single market WITHOUT accepting EU migrants, is simply that it is hard to see why the economically weaker countries would agree to this. A few things to consider here: - lets imagine we are now July 2016 and Britain has voted to leave. There are EU migrants in the UK and UK migrants in other EU member states. What will happen to them? Well, the key point is that their right to carry on living in the host state will no longer be an EU right but will be dependent on the immigration laws of

4 the host state. So for the hundreds of thousands of Brits living in Spain and Portugal, EU law allows gives them those rights of residency including the right of permanent residency if they have lived there for 5 years under certain conditions. If the UK votes to leave and does not sign any treaty with the EU on the issue, Brits can only continue to live in Spain if Spain wants them to, and passes laws to that effect or if Brits come within Spanish immigration law. Obviously, I can see why the Spanish would love the Brits to stay, because these Brits contribute massively to the Spanish economy. But we in the UK have just voted to leave the EU because we think there are too many pesky EU migrants sponging off our social security. And now we do not have EU law holding us back. So we may pass laws limiting who can carry on staying in the UK. What if these means some Spanish migrants go back to Spain, can you guarantee that Spain will not retaliate at least to some extent? You can repeat this thought experiment for more or less any EU country. For instance, we are a very popular destination for French migrants/retirees, what if our post-eu politics effectively limits their numbers, can you see the French not retaliating?

5 - lets imagine again that we are now July 2016 and Britain has voted to leave. The powerful industrial countries who export a lot of goods to us would want us to trade with them. Euro-sceptics often say this. That is certainly true, so they will be keen to give us access to the Single Market. But for the EU to approve a treaty it negotiates with another country (the UK) it needs countries representing 65% of the EU population to vote in favour plus a majority of MEPs in the European Parliament. Here is where the problem could come. The weaker countries (including Greece, Spain, even Italy, as well as the Eastern European and Baltic states) will be worried that if they continue to give access to superior UK goods, services and companies while their citizens are not be allowed to go to the UK, their economies could suffer. Not only will they get swamped with better UK goods and services, they will also not be able to allow their citizens to move to the massive UK market to find work. Now I do not know how the maths will work out (in terms of 65% of population and 50+% of the Parliament) but my aim here was to point out (1) there is no legal right for the UK to demand this if Brexit happens and (2)

6 there is a significant risk in thinking that we can - politically - get the EU states to give us access to the single market without us allowing in their citizens in to the UK as workers. But there are even more important reasons why they won t do this (the next couple of bullet points address this): - the other thing the leaders of these countries will be worried about is setting a precedent, whereby if the populations of other economically strong countries see that the UK is getting all the benefits of continued access to the single market for their top draw goods, service industries and companies but not taking any migrants, they may demand similar deals. If I was the leader of any of the smaller EU nations I would be very hesitant to set a precedent. The precedent would not be legally binding of course, but would create political pressure in the larger countries pushing some voices in those countries to seek to leave the EU (we are not the only Eurosceptic country!). - the political facts are that EU has NEVER allowed ANY country full access to the single market without taking on the obligations

7 of free movement of migrants. Switzerland, which is not an EU state, has a co-operation agreement with the EU in which it applies more or less all the single market rules including those on migration. A couple of years ago, the Swiss held a referendum on this agreement. The people of Switzerland voted for their government limiting the number of EU workers coming to the country. So the Swiss government had to re-negotiate that EU agreement. As mentioned before, all parties to an agreement must agree to change it. This is how the EU member states responded to the Swiss request for re-negotiation of the EU-Swiss agreement: The Council [i.e. the ministers of all 28 member states] has taken note of the outcome of the vote in Switzerland on a popular initiative Against Mass Immigration on 9 February 2014.While fully respecting the internal democratic procedures of Switzerland, the Council reconfirms the negative reply in July 2014 to the Swiss request to renegotiate the Agreement. It considers that the free movement of persons is a fundamental pillar of EU policy and that the internal market and its four freedoms are indivisible.

8 ( Internal Market and Single Market are inter-changeable terms. See the full document at

Options for Romanian and Bulgarian migrants in 2014

Options for Romanian and Bulgarian migrants in 2014 Briefing Paper 4.27 www.migrationwatchuk.com Summary 1. The UK, Germany, France and the Netherlands are the four major countries opening their labour markets in January 2014. All four are likely to be