[Skip to Content]

Register to receive the OMFIF Daily Update and trial the OMFIF membership dashboard for a month.

* Required Fields

Member Area Login

Forgotten Password?

Forgotten password

Analysis
European dilemma closes in on Cameron

European dilemma closes in on Cameron

Ministers past and present line up to denounce Europe
In the European battle, still a lot to play for

by David Marsh

Mon 13 May 2013

David Cameron, the UK prime minister, accomplished what seemed a coup in January by announcing a referendum on Britain’s EU membership possibly in 2017 – an attempt to carve out much-needed political manoeuvring room by heading off sweeping popularity gains by the nationalist UKIP party.

Four months later, the policy has backfired. Cameron is on the ropes at the hands of two politicians called Nigel, a quintessentially British name habitually applied to lovable rogues. If the row continues, and depending what happens to the dollar and the euro, the infighting breaking out in the Conservative party could damage sterling and disturb confidence in Britain's wafer-thin path to recovery.

UKIP, led by telegenic former commodity broker Nigel Farage, accomplished a wide-ranging victory in British local elections at the beginning of May. Qualms about future governance arrangements for monetary union, on the grounds that the UK cannot possibly sign up to the tighter links needed to make the euro work, are driving fresh opposition to Britain’s European ties. Two former senior Conservative ministers made Cameron squirm last week by calling on Britain to quit the European Union. The best-known is Nigel Lawson, chancellor of the exchequer between 1983 and 1989 under prime minister Margaret Thatcher.

A month after Thatcher's death, 81-year-old Lawson has become the country’s most exalted Thatcherite heir, arguing in a piece for The Times newspaper that there is now a 'clear' case for British withdrawal from the EU, since the economic benefits would 'substantially outweigh the costs'. Cameron's troubles deepened over the weekend when two Conservative cabinet ministers, education secretary Michael Gove and defence secretary Philip Hammond, said they would quit the European Union if a vote took place now.  

Far from being strengthened by the plebiscite ploy, Cameron has seen his position derailed at a sensitive time given his meeting with President Barack Obama in Washington today.

Amid growing calls for the British leader to bring forward the referendum ahead of the next general election, due by 2015, opinion polls say there is potential for a ‘No’ campaign gaining 43% of the votes against only 35% for those who wish the UK to remain inside the EU.  

This eight point gap is actually lower than in recent years, when the margin has normally been 15-20 points. Cameron has pledged to fight for changes in the UK’s relationship with the rest of Europe – less unpopular spending and bureaucracy, more transparency and accountability and the repatriation of certain powers back to London.

The prime minister believes that, provided he can make such policies stick, that should be enough to keep Britain in. But nothing is inevitable in politics. Assuming Cameron wins the next election and holds a popular vote on Europe, then the benign outcome of continuing British adherence could still come true.

But there are also important counter-reactions across the continent. This includes some leading public figures in Germany who oppose the less market-orientated and more dirigiste Europe that could ensue if the UK left – as well as from politicians from other countries who see Britain as a bulwark against German domination. In the battle over the UK and Europe, there is a still a lot to play for.

Tell a friend View this page in PDF format