A FINE MESS OVER MAASTRICHT

Tribune, 10 July 1992

Paul Anderson explains why Labour MPs and MEPs are arguing over Europe

The first big policy question that John Smith will confront when he becomes Labour leader next week has vexed the party for three decades: Europe.

Since last month's rejection of the Maastricht treaty in the Dan­ish referendum, Labour's fragile consensus on the European Com­munity, carefully constructed to minimise argument in the run-up to the election, has all but col­lapsed. However the 12 EC gov­ernments eventually decide to deal with the Danish rejection of the treaty, Smith is going to have to work hard to prevent a Labour split over the British govern­ment's Maastricht bill.

Smith recognises the difficulties ahead and has taken care to rule out nothing in the way of tactics. Last weekend, he made it clear that he expects dissent among Labour MPs and MEPs whatever line the leadership eventually agrees, telling a television inter­viewer that "it is just impossible to expect on an issue of this kind that they will all vote in the same way and there has to be some respect for differing opinions".

The problem is not really that either the Parliamentary Labour Party or the European Parliamen­tary Labour Party are particularly divided in their opinions of the treaty. With the exception of a small group of Euro-fanatics (30-strong at most among MPs) who want to vote for Maastricht, there is a consensus that the terms of the treaty are far from perfect.

On economic and monetary union, there is a widespread belief in both the PLP and EPLP that the treaty is too deflationary and that its criteria for convergence be­fore the creation of a single Euro­pean currency are too narrowly fo­cused on interest rates, inflation and state spending. There is a sim­ilar agreement that the British government's "opt-out” on the so­cial provisions agreed by the other 11 signatories is indefensible. On political union, there is near-con­sensus that the Maastricht deal does not give enough extra power to the European Parliament.

But none of this makes for agreement on how the party should respond to the govern­ment's Maastricht Bill. Just about everyone apart from a handful of anti-EC diehards reckons that Labour should vote for the Maas­tricht bill if it can secure an end to the social chapter opt-out - but no one really believes that Labour can force the Tories to climb down on this. So Labour is heading for a show-down between those who think that Maastricht without the social chapter should be opposed and those who believe that the party cannot in the end oppose Maastricht because the only con­ceivable alternative is worse: no progress at all towards European union. The depth of disagreement already suggests that Labour would split down the middle if it came to a referendum on the bill.

The most articulate of the anti-Maastricht pro-Europeans is Peter Hain, MP for Neath and secretary of the "soft left" Tribune Group of MPs, who was the author of a Tri­bune Group motion calling for op­position to the Bill put to the PLF last month. His move, which has the support of perhaps one-third of Labour MPs, has caused ructions in the PLP, which agreed to post­pone coming to a decision on Maastricht bill tactics, and Tri­bune Group MEPs are now threat­ening to split with their Westmin­ster colleagues because they were not consulted about it.

Hain is unrepentant. "It's not a factional issue," he says. "It's about establishing a socialist cri­tique of Maastricht."

For him, the Tories' disarray on Europe is something for Labour ruthlessly to exploit. Labour has nothing to lose by making it clear that it will vote against the Maastricht Bill unless the Government changes its line on the social chap­ter. With a little help from Tory rebels, Labour could ensure that Britain did not ratify Maastricht, killing the treaty for good whatev­er happens with Denmark and forcing the 12 to negotiate a new, more democratic, growth-oriented European union agreement.

Some critics of this position, no­tably Neil Kinnock in the PLP meeting at which it was discussed, have argued that Labour would destroy its credibility with its con­tinental sister parties if it decided to vote against Maastricht. Accord­ing to Giles Radice, MP for Durham and a long-time pro-Euro­pean whose book Offshore: Britain and the European Idea has just been published, “There is little doubt that a U-turn on Maastricht would cut Labour off from the con­structive dialogue with continental socialist parties which has been such a feature of the last five years."

Others say that the main prob­lem with the Hain position is that it implies that if Maastricht falls a better treaty on European union could be negotiated, when in fact it couldn't. Maastricht was the prod­uct of intensive negotiations among EC governments, they say, and it is difficult to see how they could reach agreement on a differ­ent compromise if negotiations were reopened. Wayne David, MEP for South Wales, is typical. "It's Maastricht or nothing," he says. "We should stop kidding our­selves."

He could well be right. The cen­tre-right German government will not budge in its insistence that the Bundesbank should be the model for the European central bank and, for reasons deeply root­ed in German history, will not sanction any attempt to downplay the centrality of price stability in the criteria for convergence and as a goal of EMU.

If it came to renegotiation, it is hard to conceive of French president Mitterrand extracting any more concessions from the Ger­mans than he got first time around: the role of Ecofin, the Council of Economic and Finance Ministers of the EC countries, in overseeing the central bank, and the rather vague commitments to goals of growth and social cohesion. There would also be very little likelihood of renegotiation removing the British opt-out on the social chapter.

On political union, there seems to be just as little room for ma­noeuvre. Kohl has suggested that a way out of the impasse created by the Danish referendum might be to bring forward negotiations, scheduled to begin in 1996, on in­creasing the powers of the Euro­pean Parliament. But this is anathema to the British govern­ment, which is committed to the principle that intergovernmentalism should be the foundation of EC decision-making, with the Council of Ministers playing the key role. John Major has suggested that the way to get the Danes back on board is to emphasise the impor­tance of "subsidiarity", the doc­trine that decisions should be made at the lowest level possible, interpreted by his government as meaning "the level of the nation-state".

Of course, the 12 might have no option but to start again if no way is found of getting the Danes to change their minds, which would mean the end of the British Maas­tricht bill regardless of what Labour does. While that remains a strong possibility, it is perhaps un­derstandable that the Labour lead­ership sees the value of making soothing noises and keeping its op­tions open. Eventually, however, Labour is going to have to make up its mind about what it wants from Europe.