Most of the Union’s members have reservations with regard to the possible limitations of in-work benefits for EU workers in the UK, contained in the proposals from Brussels to address David Cameron’s demands ahead of the Brexit referendum. The EURACTIV network reports.
Council President Donald Tusk published proposals aimed at responding to British renegotiation demands on 2 February. Those have been agreed with the UK, and are now the subject of negotiation with the remaining 27 member states. The 18-19 February summit is expected to endorse the package, with possible modifications (see background).
Most member states have no problems with the proposal in general, but many of them express concerns that cuts to the in-work benefits would represent discrimination and a breach to the principle of freedom of movement of workers.
However, none of the countries appears determined to pick a fight, as all seem to agree that keeping the UK in the Union is in the common interest. What could be negotiated is the duration of the limitation, which could last up to four years, and some minor tweeking of the text.
The in-work benefits in the UK are quite unique in the EU. In fact, they typically supplement the earnings of low-wage employees.
Another element of the package, that child benefits for migrant workers whose children stay in their home country would be indexed to the level of the member state where the child resides, doesn’t appear to be controversial.
France and Germany
Paris and Berlin are expected to have similar positions at the summit. German Chancellor Angela Merkel and French President François Hollande met on 7 February in Strasbourg to discuss its reparations.
France has had a rather cold reaction to Tusks’s paper submitted to the EU members in preparation of the summit. Beforehand, Hollande had warned he would not support any change in EU treaties nor allow the UK to have his say about the eurozone. Indeed, the package contains no such provisions.
Hollande also warned that there should be no further changes to the deal at the summit itself, which means that the package should be agreed on before leaders arrive in Brussels.
However, France can hardly be the champion of non-discrimination at a time when the country’s legislators discuss stripping “foreign fighters” of French nationality.
France has also tried to wake up its neighbor about the concrete consequences of Brexit. Some warned that Calais’s Jungle camp might move straight to Dover in case of Brexit, an idea that was retaken by David Cameron over the weekend.
German Federal Minister of Labour and Social Affairs Andrea Nahles stated that the principles of free movement of workers and non-discrimination are non-negotiable for her country. But she also said that Germany was ready to find a solution to the British issue of benefits for foreign EU citizens.
“In our view, there are loopholes when it comes to avoid existing disincentives,” Nahles said.
It is no secret that Italian Prime minister Matteo Renzi wants the UK to remain in the EU. Rome and London share the same perspectives on the need to change the EU, with the exception of the restrictions affecting the freedom of movement.
Renzi is concerned about the negative spillover that such a request might have on the thousands of Italian citizens working in the UK.
According to recent data, there are approximately 200,000 Italians living in Britain, about half of them in London. If, as expected, Brexit causes the loss of many jobs (the optimists predict one million, the pessimists three), tens of thousands of Italians will return home. Those who remain will have to apply for a residence permit and work permit, and the same will have to be done by 20,000 British citizens living in Italy.
If Britain leaves Europe, Italian businesses established in the UK — from Finmeccanica to Eni, from Merloni to Calzedonia, from Pirelli to Ferrero, from clothing to food, furniture and spots cars – might need to reconsider their trading partnerships, subject to new rules. Apart from trade relations, the UK’s net contribution to the EU is estimated to be around €13.5 billion. In this respect, a Brexit would reduce the EU budget, making it likely Italy will need to pay more.
The incongita remains the intense debate that Brexit has fuelled among Eurosceptic parties. The Northern League and Five Star Movement in Italy have been the strongest advocates of a possible imitation of Brexit in Italy. Matteo Salvini, MEP and head of the Northern League, has launched a petition to collect signatures for a similar EU referendum.
Sources at the Spanish Ministry of Foreign Affairs told EURACTIV that Madrid was seeking a wide consensus in the EU Council, and that it kept its firm commitment to help keep the UK in the Union.
Salvador Llaudes, analyst on EU topics at the “think tank” Real Instituto Elcano, in Madrid, commented:
“Overall, Tusk’s proposal is considered by Spain a good basis for a future agreement. There are aspects that Madrid likes more than others, of course. One thing Spain likes is the fact that immediate reform of the EU treaties is not required, but rather a modification of “secondary legislation”.
But other points of Tusk´s proposal are more controversial and difficult to accept: on the issue of social rights of immigrants, Spain has two “red lines”: the full respect for the free movement of European citizens and the full respect of the principle of non-discrimination based on nationality.
Spain sees in Tusk´s proposal a real danger of loss of social rights in Europe, even if this is just for a limited period of time. It is true that the UK would need the green light from the rest of the EU member states to put in place this measure, but still does not convince Madrid.
One thing Spain does not like at all is the fact that the Commission has already submitted a draft in which it is expressly stated that conditions are met for the UK to activate this “emergency brake”.
On the other hand, Madrid is not happy with the red card proposal, because it would complicate the current legislative process and give the national parliament the right to veto or block certain directives.
Spain would have preferred a “green card” system, which would provide a number of inputs to the Commission for legislation. Madrid will, in principle, not block these two proposals and seek a constructive solution”.
So far it seems that the Czech Republic generally supports the Tusk proposals. The main concerns of the government are related to the social welfare cuts. Prague takes the view that there should not be any restrictions on the British labour market and social welfare system, which would discriminate against migrants from certain states, and that the potential changes could have impact only on newcomers, not on workers who are already in Britain.
The proposed “emergency brake” mechanism is acceptable to the Czech Republic. The crucial debate will be on how long the free movement can be reduced under this mechanism.
The countries of the Visegrad group, of which the Czech Republic holds the rotating presidency, will hold a mini-summit on 15 February in an effort to coordinate a common position ahead of the EU summit.
Tusk will visit Prague on 16 February to discuss the compromise package with Prime Minister Bohuslav Sobotka.
Referring to the 60,000 Slovak citizens who officially work in the UK, Slovak Prime Minister Robert Fico said he could not agree that they would be affected by the new conditions, which would significantly limit their right to various social benefits.
He made this statement after bilateral meeting with Cameron in London at the Syria donor conference, on 4 February.
“We insist that those who work currently there (in the UK) will not be affected,” Fico stated, asking for assurance that the deal would not have a retroactive effect.
Slovak diplomats have maintained that a situation when British and Slovak nationals working behind “desks next to each other” were treated differently represented a red line.
As far as other areas of reform are concerned, Slovakia does not oppose the propose parliamentary “red card” mechanism for national parliaments. Fico made it plain he supported the competitiveness boosting measures.
“Should Britain leaves the EU, it would be a great loss for both sides. Therefore, I welcome the compromise draft put forward by Donald Tusk,” Fico said. Nevertheless, some measures outlined in the document still needed “clarification”, he added.
The Polish position doesn’t seem to differ in substance from those of the other three Visegrad members. What is interesting is the strange situation in which the new government of the Law and Justice party (PiS) wants to present the United Kingdom as one of Poland’s closest allies. Both David Cameron’s Conservative Party, and Jaros?aw Kaczy?ski’s Law and Justice party, are members of the European Conservatives and Reformists’ (ECR) group in the European Parliament.
But at the same time Poland is the EU country with the largest number of its nationals working in the UK, the figure of one million being frequently mentioned. Poland therefore finds it hard to accept any “discrimination” against Polish citizens living in the UK – such as cutting immigrant benefits.
Also, the Polish government doesn’t want to openly criticise the proposal by Council President Donald Tusk, who is a former prime minister, albeit from the Civic Platform party, now in the opposition.
The Romanian government accepts some of the provisions negotiated between Tusk and Cameron. At the same time, the government in Bucharest says in a statement that reducing social benefits for EU workers should not interfere with fundamental European freedoms.
What Bucharest finds acceptable and constructive are the ideas regarding the consolidation of the common market, increasing competitiveness, economic governance and a clear and predictable legislation.
But the cuts to social benefits seem to be a no-go-zone if these lead to discrimination between European citizen and to breaches of European law.
“We believe that the UK belongs to the European Union and thus we are open to finding solutions that accommodate British concerns, but these must not affect fundamental rights and liberties,” the Romanian government stated.
Bulgarian diplomats told EURACTIV that a meeting at the “Sherpa” level, to discuss the paper circulated by Tusk, had taken place. A second one is scheduled for 11 February, and a third one could take place just before the summit.
It would be detrimental to disclose much information while talks are ongoing, a diplomat said. However, he made no secret that the main concern for Bulgaria are the texts concerning the social benefits for EU workers.
“Bulgaria, as for other countries for Southern and Eastern Europe, defends the position that any possible restrictions should not hamper the freedom of movement of workers, that they should not create discrimination among EU citizens, and that they should not lead to less favourable treatment of EU citizens, compared to non-EU citizens,” the diplomat said.
He added that the possible restrictions should be of limited duration and not concern social benefits resulting from the workers’ financial contribution. They should also apply only to newly-arriving workers.
Bulgaria’s approach to the debate is constructive, with the understanding that it is in the interest of both the UK, and the other member states, that the country stays in the Union, the diplomat said.
Swedish Prime Minister Stefan Löfven said in London on 4 February that he was positive with regard to towards the current Brexit proposals, but he criticised limiting social benefits for EU citizens working in the UK.
“I have had discussions both with the EU and with Cameron about the fact that we need to have a development in Europe where European workers get better conditions, not worse conditions,” Löfven said.
Danish Prime Minister Lars Løkke Rasmussen met with Cameron in Copenhagen on 5 February to discuss the package presented by Tusk.
“The Danish position is clear: We want the UK to stay in the EU. We need strong and sensible voices in the EU, which the UK is. We support the package which the UK has been offered. I support all the elements related to access to benefits,” Rasmussen stated.
The Danish PM was the first to tweet his support to the package as a “good basis of negotiations”, minutes after it had become public.
— Lars Løkke Rasmussen (@larsloekke) February 2, 2016
— Lars Løkke Rasmussen (@larsloekke) February 5, 2016
Council President Donald Tusk published proposals aimed at responding to British renegotiation demands on 2 February. Those have been agreed with the UK and are now subject to negotiation with the remaining 27 member states. The 18-19 February summit is expected to endorse the package, with possible modifications.
The package contains four areas requested by the UK – economic governance, competitiveness, sovereignty and social benefits. It includes a red-card system to allow national parliaments making up more than 55% of votes in the Council to be able to veto EU legislation. It also contains a commitment that British taxpayers’ money can never be liable to support the eurozone, and that the UK is not committed to further political integration into the European Union
The most controversial element appears to be the provision that Britain would be able to request an “emergency brake” on in-work benefits for EU migrants for up to four years, subject to the permission of other member states. The emergency brake could be requested by any member state but would have to be approved by the whole EU council, either by unanimity or a qualified majority vote. The text does not make clear how long the brake could be applied for.
- 11 February: Second meeting at “Sherpa” level.
- 14 February: Visegrad summit.
- (Possibly) 16 February: Third meeting at “Sherpa” level.
- 18-19 February: EU summit.