Chapter 21

Expanding Horizons: Europe and the EU

In This Chapter

Recognising the European Union’s importance and its goals

Building relationships inside and outside the EU

Agreeing to major EU treaties

Examining EU budgets

In this chapter, I take you on a tour of the UK’s nearest neighbours and look into the inner workings of an institution – the European Union – that has a massive influence on everyday life in the UK. Many say that the UK’s future is as part of what amounts to a united states of Europe; others disagree and want the UK to skedaddle out of the EU and go it alone. Read this chapter to get a better idea of what they’re going on about.

Understanding the EU and How It Works

The European Union – or EU, as it’s known – is an extraordinary institution. It can trace its roots back a couple of centuries to when Tsar Nicholas of Russia talked about a union of European states. More recently, in the 1940s, British wartime prime minister Winston Churchill envisaged a United States of Europe. But these two great leaders could have no idea just how powerful an institution would emerge in the late 20th century when the Europeans – who’d been fighting each other from year dot – finally decided to pull together.

To appreciate why the EU came about you have to understand that its formation came a little over a decade after the end of the Second World War, in 1957. For its originators, the EU was seen as a way of reducing national competition and antagonisms that had so disastrously plunged the continent into war. I talk more about the history of the EU in the nearby sidebar ‘Expanding the EU: Six become 28’.

The key facts in the following list highlight just how big a deal the EU is to the UK – which is part of it – and in the wider world:

• The EU encompasses 28 countries from the Russian Steppe in the east, the Arctic Circle in the north, the shores of Africa in the south and the coast of Portugal in the west.
• Up to 500 million people live in the EU member states (compared to the just over 300 million people who live in the United States).
• The economies of the EU combined comprise the biggest economy in the world, bigger even than that of the US.
• The EU may be made up of separate states but citizens across all countries are allowed to work in any state.
• The EU is a huge free trade area, called the single European market, with all member states able to sell goods and services to each other free of tariffs or quotas.
• The EU has its own currency, the euro, which most member states trade in. The euro is one of the world’s great currencies, rivalling the dollar for the number of transactions carried out using it.

To be able to join the EU, a state must meet the Copenhagen Criteria, named because the European Council agreed upon them in the Danish capital. The criteria say that member states have to respect human rights and the rule of EU law (which I talk about in the upcoming ‘Looking at law-making and the legal system’), as well as open their borders to trade and workers. Generally, a country has to be in Europe to be a member of the EU. However, the bulk of Turkey’s land mass is in Asia and yet the EU is considering it for membership.

The UK refused to join the EEC (forerunner of the EU) at its inception in 1958 – we really didn’t want much to do with those foreigners, don’t you know, old chap! – and instead went about forming its own economic club, the European Free Trade Association (EFTA) with nations such as Denmark (5 million people) and Switzerland (7 million people). But some UK politicians realised that EFTA wasn’t quite as good as belonging to the EU, which had France and Germany in its ranks, and began negotiations for the UK to join it.

Checking the goals of the EU

European politicians often disagree about the EU’s purpose. Some see it as merely a free trade area; others view it as much more a precursor to a United States of Europe. But everyone can agree that the EU looks to achieve some fundamental goals that include:

• Promoting free trade between all member states and the free movement of people to live and work wherever they wish. That freedom of movement is quite a big deal for many people.
• Preventing any member state gaining an unfair trading advantage through its government subsidising domestic industries.
• Ensuring greater harmonisation of national laws relating to business and the consumer.
• Protecting EU businesses from unfair competition from countries outside of the EU.

Jacques Delors, the French politician and former president of the European Commission (see ‘The European Commission’ a bit later on for more), is widely seen as the spiritual father of European federalism: the belief that a United States of Europe should exist. Delors campaigned for closer integration of member states and the establishment of the euro, the single European currency. For a while in the early 1990s Delors became a hated figure for some in the British press because he was seen as trying to strong-arm Britain into joining a United States of Europe. Famously, one Sun newspaper headline of the time read ‘Up Yours Delors’, accompanied by a picture of a hand holding up two fingers – most rude!

Examining EU institutions

The EU breaks down into four parts, each with its own role and powers. The following sections cover these parts.

The Council of Europe isn’t an EU organisation at all, but a group of 47 European states whose collective objective is to encourage peace, understanding and democracy in Europe.

The European Commission

The European Commission is the executive body of the European Union. This body makes major decisions and draws up laws for consideration by the European parliament and Council of Ministers.

The Commission has 28 members – one for each member state – appointed by their respective governments. Each commissioner fills a specific role and is meant to act in the interests of all member states rather than the nation she hails from. As far as the UK is concerned, commissioners are often senior politicians in the twilight of their political careers. They may have been prominent government ministers in the past but the prime minister has now appointed them to the role of commissioner.

The president’s role resembles that of the UK prime minister – orchestrating meetings of the Commission, which in turn works a bit like the UK cabinet. Currently heading the Commission is the former Luxembourg prime minister Jean-Claude Juncker. The election of Juncker in 2014 was highly controversial in the UK. Mr Juncker was seen by prime minister David Cameron as a politician who believed that the EU should move towards closer integration – a United States of Europe. Mr Cameron and most within the Conservative party he leads oppose greater integration and therefore Cameron didn’t want Juncker. However, he was in a minority of just two in Europe – with Hungary the only other EU state to side with Britain and oppose Juncker’s election – and as a result Mr Juncker got the top job after all.

Here are some of the Commission’s major powers:

• Draft EU law.
• Represent the EU at trade negotiations such as those of the World Trade Organisation (refer to Chapter 20 for more on the WTO).
• Develop trade and political strategies for the EU as a whole.

The Commission shares out jobs between the 28 commissioners and their countries. As a rule, the most important jobs go to the commissioners from the biggest countries in the EU – France, Germany, Italy, Spain and the UK. Often countries try to secure the right to appoint a commissioner to a role that suits their national interests. So, for example, the French president may be chosen to decide who’s agriculture commissioner, and the British PM may be chosen to appoint the competition commissioner.

The Council of the European Union

Laws and directives drawn up by the European Commission have to go through the Council of the European Union before they actually become law. The Council is made up of representatives from the individual states but they’re not meant to remain neutral as commissioners are (see the preceding section); ministers are specifically in place to represent the interests of their member states.

What’s more, unlike the egalitarian make-up of the Commission, where each state gets a commission appointee, in the Council of Ministers each country is allocated a block of votes relative to its size. So, for example, the countries with the biggest populations – France, Germany, Italy and the UK – get 29 votes each (which is a little unfair on the Germans because they have by far the highest population) and other countries get fewer votes. For example, Poland gets 27 votes, the Netherlands 13, and tiny Malta (with only 421,000 people) gets 3. Bear in mind, though, that the number of votes isn’t completely relative to the population size; it’s only a broad approximation, and some of the smaller countries are over-represented and the bigger ones under-represented.

The purpose of assigning these voting blocks is so that the Council can reach a majority and therefore decide to pass or reject laws drawn up by the Commission. But actually the Council doesn’t need a majority – nothing’s so simple in the convoluted world of the EU. Instead, from 1 November 2014, 55 per cent of the states representing at least 65 per cent of the EU’s population have to be in favour for a law to pass. This outcome is catchily called a qualified majority. Under this system of voting, no single member state can effectively stop laws on which the others agree.

The representatives of the Council are often senior politicians from the member states, and each country has a representative for each of the big policy areas. For example, the UK has a representative whose speciality is the environment and another who’s an expert on trade, and so on. These specialist representatives often meet to thrash out agreements in their individual policy area. Meanwhile, behind the scenes civil servants from the member states carry out much of the negotiating.

The European Council

The European Council is made up from the heads of government from all the member states. It meets at least twice every six months to discuss the major issues affecting the EU, such as its international relations and what future EU treaties will cover.

The European Commission drafts the laws for the EU and the European Council sets the broad framework of policy direction. So, for example, if the European Council says it would like to see closer harmonisation of rules governing trade among EU member states then it’s up to the Commission to draft specific laws to see that happens.

In terms of actual powers, the European Council doesn’t have many apart from the right to appoint the president of the Commission, which itself is quite significant because it’s often the president who sets the agenda for law-making in the EU and acts as its figurehead. But despite having only limited powers, the Council is incredibly important within the structure of the EU because of the authority of the people who attend. They are, after all, the leaders of governments, so what they say – if they agree – usually goes in the EU.

Meetings of the European Council are often dominated by arguments over how the EU is spending its money and whether or not the powers of the EU should expand – inevitably at the expense of the powers of the nation states.

In 2009, under the terms of the Treaty of Lisbon, a new post was created in the EU: the president of the European Union. This is largely a figurehead role. The president is supposed to co-ordinate the work of the European Council and represent the EU at world summits.

The European parliament

Finally, we get to a body that you may be aware of because, lo and behold, you actually get to vote on its membership. Every five years voters from all 28 member states get to choose their Member of the European Parliament (MEP) (refer to Chapter 6 for the lowdown on how this election works).

But what powers does the European parliament actually have, considering that the Commission draws up the laws and the Council of the European Union approves them? Well, the main task of the European parliament is to debate and suggest amendments to the laws that the Commission draws up. The parliament is full of elected representatives – unlike the Commission or Council of the European Union – and when they vote to amend a law or to say that a law shouldn’t go ahead, what they say has considerable sway on the debate. After all, to completely ignore the parliament and what it says would be undemocratic.

The powers of the European parliament have grown in recent years. Under the terms of the 1997 Amsterdam Treaty – yes, the EU loves its treaties – the parliament was given ‘co-decision’ status with the Council of the European Union. Under the procedure set up in the treaty, the Commission presents a proposal to parliament and the Council that can only become law if both reach agreement. If the two bodies disagree, a conciliation committee – made up of MEPs and councillors – meets to thrash out a compromise. If either body rejects the draft law, it’s then up to the Commission to either amend the law and reintroduce it to the Council of the European Union and the European parliament or withdraw it altogether.

Some suggest that the EU is more autocratic than democratic because so much of the law-making power is in the hands of the European commissioners, who are appointed by the governments of the member states rather than directly elected by the people.

Looking at law-making and the legal system

The EU is now much more than a club with members striving for free trade and to promote economic growth. It actually has many of the hallmarks of a state. It has its own parliament, president, courts and even, crucially, laws. (The preceding section, ‘Examining EU institutions’, covers the various arms of the EU.)

In member states – including the UK – EU law has the same weight (and sometimes more) as laws made by the domestic parliament. In 1986 the UK parliament passed the Single European Act, which in effect provided the green light for EU law to be binding in the UK. At one stroke, laws made by the EU had precedence over laws made by the UK parliament. This was a big day in the history of Britain’s unwritten constitution, which I talk about in Chapter 12.

In areas concerning competition and the operation of what’s called the single European market (in essence, the free movement of goods and people), EU law actually has precedence over domestic laws. So, for example, a law made by the UK parliament that limits the number of cars imported from Germany would be superseded by the EU law that forbids quotas on any goods coming from a fellow member state.

Two main types of EU law exist:

• Direct effect law: This comes about when member states sign up to an EU-wide agreement. The terms of the EU agreement supersede any national laws.
• Directive law: Under this type of law, basically the EU directs the member states to do something and they then have to alter their own domestic laws in order to conform to the EU directive.

Nearly all EU laws originate with the European Commission, which is made up of representatives from member states.

The EU has an ambassador to the United Nations, and the president of the European Commission attends meetings of the G8 group of nations (discussed in Chapter 20). In addition, the EU has its own flag and, that crucial trapping of nationhood, a national anthem: Beethoven’s ‘Ode to Joy’.

Getting litigious: The European Court of Justice

Just like a nation state, the EU has its own court system. However, this court system is designed to augment the courts of member states rather than supplant or rival them.

The European Court of Justice (ECJ) is responsible for interpreting EU laws and ensuring consistent application across all 28 member states. If a court in an EU member state is hearing a case that involves EU law, the domestic court asks the ECJ to look at the case and then give a ruling. The domestic court is then bound by the decision of the ECJ.

Protecting human rights in the European Court of Human Rights

The Council of Europe set up the European Court of Human Rights to uphold the European Convention on Human Rights, which sets out basic freedoms that all people in the EU can expect, such as the right to life, liberty and freedom from torture; and the right to a fair trial, privacy and to marry whomever they please.

If an individual feels these freedoms have been contravened, she can take the case to the European Court of Human Rights. However, the person who feels wronged must first have exhausted the legal processes in her own country. The European Court of Human Rights is only ever a last resort and the process of getting a case heard there can be painfully slow.

Forming Relationships Within and Outside the EU

The EU is more than an economic club but slightly less than a fully fledged state. Over time its influence over member states and on the international stage has grown, and whenever major decisions in world politics are being taken a representative of the EU is normally involved. But as well as playing a role at the top table of international politics, the EU is concerned with issues such as expanding its membership, securing natural resources – most particularly oil and gas for its massive industries – and helping ensure peace and security within Europe itself.

All EU member states have to agree to the entry of a new member state before it can happen. In effect, any member can veto a country trying to enter the EU.

Representatives of the EU – whether they be civil servants or the president of the Commission – are in attendance at the meetings of all the world’s main international bodies (such as the UN, G8, World Bank or World Trade Organisation) and major conferences such as those held to discuss climate change.

Looming giant: Russia on the doorstep

The EU’s relationship with Russia is a knotty one. Russia was once one of two world superpowers but has now lost this status. However, this giant country, with a population greater than Germany, the UK and the Netherlands combined, is still formidable. Russia has a massive army, limitless natural resources and a difficult history with western Europe, having been invaded by the Germans, the British, the Turks, the Swedes and the French over the past couple of centuries. In the aftermath of the Second World War Russia controlled eastern Europe through installing a series of brutal puppet regimes, and for 40-odd years squared up to the North Atlantic Treaty Organisation (NATO) in what’s known as the Cold War. In short, plenty of history exists between Russia and the countries of the EU.

But the simple truth is that the EU needs good relations with modern Russia because it happens to be one of the most oil- and gas-rich countries on earth. Russia has massive pipelines carrying gas from east to west, and if it cut off energy supplies, most of western Europe would be plunged into darkness. But Russia needs the EU too, because the money it earns from the economies of western Europe is of huge importance to its economy and government.

Many fear, though, that Russia will use the fact that the EU is so dependent on the energy it supplies as a means to exert political pressure – and, frankly, Russia would be a mug if it didn’t, at least in some ways. As a result, some members of the EU – most notably Germany – have tried to forge good relations with the Russian government. Meanwhile, the UK, which is seen as close to the US diplomatically and is less reliant on Russian energy, has what people widely deem to be poor relations with the government of Russia.

Testing question: Is Turkey really part of Europe?

The question of Turkey is perplexing many leading EU politicians. Put simply, Turkey would love to join the EU, and some countries, such as the UK, are quite happy for it to do so. However, other countries – most notably France – are worried that Turkish entry into the EU would change the EU for the worse. These are some of the reasons given for not allowing Turkey entry into the EU:

• Turkey is poor compared to most of the EU nations; it also has a massive population in excess of any member of the EU.
• Turkish agriculture isn’t very advanced compared to the EU; as a result, the country may be a major drain on the resources of the Common Agricultural Policy budget.
• Turkey is a Muslim country and the EU is made up of ostensibly Christian states; some suggest this would alter the character of the EU.
• Turkey is actually geographically in Asia rather than Europe.
• For many years Turkey has had a poor human rights record and its government stands accused of mistreating its Kurdish minority.
• Turkey is in disagreement with Cyprus over the existence of a separate Turkish-backed state in the north of the island.

The anti-Turkey lobby raises quite a few issues, but some very good reasons also exist for allowing Turkish entry; some of these simply involve seeing the negatives (as perceived by entry opponents) as opportunities:

• Turkey is huge and presents a great development opportunity and export market for EU goods and services.
• Accepting a predominantly Muslim country as a member of the EU will help build bridges with the Islamic world and promote peace.
• Although part of Asia, Turkey has always played an important role in European affairs and many of its institutions are more European than Asiatic.
• Turkey’s human rights record has improved, as have recognition of individual liberties and freedom of the press, and many suggest the improvement is because the Turkish government seeks EU entry.

Bringing peace to the Balkans

Fighting in the Balkans region of Europe ended late in the 1990s, but the images of ethnic cleansing and bombing of civilians scars Europe’s collective consciousness well into the 21st century.

The peace process in the Balkans has seen the gradual break-up of the old Yugoslav state and greater autonomy for the Croats and Bosnian Muslims from the majority Serbs. These changes are due in no small part to the diplomatic efforts of the EU – backed up with the military stick of NATO.

The EU exerted pressure not just through its economic might and the fact that its members – most notably Britain and France – are strong military powers, but also by offering the long-term carrot of eventual membership in the EU to those countries that follow the path to peace.

In the 1990s Serbia, for example, was effectively at war with NATO and the militias it supported had perpetrated the worst war crimes seen in the European continent since the end of the Second World War. Nowadays, the Serb government no longer backs these militias, has handed over war criminals responsible for brutality and wants eventually to become a member of the EU.

The EU doesn’t have a standing army but many of its states are also members of NATO, which is the most powerful military machine in the world.

Pigging out: Financial crisis causes fault lines in EU

For much of its existence, the EU has been widely seen as helping the poorer nations of southern and eastern Europe develop. Grants of money and the economic and political stability that EU membership brings have helped countries like Spain, Italy, Portugal and Greece improve their infrastructure and economic performance.

But then came the great financial crash of 2008, and the likes of Portugal, Italy, Greece and Spain got into such huge economic trouble that they were unflatteringly dubbed the PIGS by some wealthier northern European countries within the EU.

Unemployment shot up in all the PIGS to levels not seen since the Great Depression of the 1930s. The German government, which has the biggest purse in the EU, insisted on massive cuts to government spending in the PIGS before they received any financial help. The governments imposed austerity measures and put the economies of the PIGS on the straight and narrow. But people in all the PIGS were angered – Greeks, for instance, burned effigies of the German chancellor (the equivalent of the UK prime minister) Angela Merkel in the street – and the resentment bred by this clash between north and south in the EU may take a generation to get over!

All the PIGS were member of the euro currency, which meant that much of the financial aid they received in the years following 2008 came from the European Central Bank (ECB). But in reality the ECB itself is effectively supported by the German government.

Understanding Britain’s thorny relationship with the EU

The UK may have been a member of the EU for over 40 years (it joined in 1973) but its relationship with other members has at times been strained. In fact, things got so bad in the early 1990s that some politicians from other EU states suggested that the UK should leave. However, doing so was never a serious possibility.

At the heart of the UK’s problems with the EU has been a difference in vision of what the EU should be about. Put simply, most British politicians and political parties would like to see the EU remain purely concerned with promoting free trade and movement of people. Yet some EU states – most notably Germany, the Netherlands, Belgium and Luxembourg – have a drive to change the EU from an economic union of states into an actual political union of states – a United States of Europe. These politicians, called federalists, would like to see member state governments become subservient to an overarching pan-European government. For these people, the EU isn’t an end in itself but a means to an end – a staging post along the way to a European super-state.

In the UK many people are opposed to the EU gaining more powers and having further influence over British life. These people are generally referred to as Eurosceptics.

The two major UK political parties – Labour and Conservative – may both have had their spats with other EU members, but ultimately they believe that the UK is better off within the EU. From a purely financial viewpoint, the vast majority of UK exports are bought by other EU members.

But the word Brexit has entered the UK vocabulary. It doesn’t refer to a new type of breakfast cereal, but is a merging of the words Britain and exit, and describes the growing possibility that in the near future Britain will exit the European Union.

The rise in popularity of the UK Independence Party (UKIP) – which wants Britain to withdraw from the EU – has led to a sea change in British politics over future relations with the EU. Many in the UK don’t like the idea of a United States of Europe and would like to see powers that the UK has surrendered to the EU repatriated to the UK. Some, such as UK prime minister David Cameron, believe in negotiation to recover powers; others, such as UKIP leader Nigel Farage, believe that only by Brexit will the UK be truly free to decide on its own affairs once again.

Table 21-1 shows that strong arguments exist on both sides of the Brexit debate.

Table 21-1 Brexit Pros and Cons

The Conservative party, under the leadership of David Cameron, has promised a referendum in 2017 on whether the UK should withdraw from the EU. This referendum is now enshrined in UK law so it has to take place, unless of course parliament repeals the law.

Putting Pen to Paper: Major European Treaties

The EU should have a ‘work in progress’ sign above its door because although it’s more than 50 years old it seems to be forever changing. The biggest changes have been brought about by an expansion of membership – from 6 to 28 members in less than 60 years. Meanwhile, the wider world hasn’t stood still, with trading blocs rising across the globe (check out Chapter 20 for more on these) and, of course, the massive economic and political progress of China and India. Against such a backdrop and adding in new global challenges, such as tackling climate change and poverty among the nations of the developing world, it’s understandable that the EU seems to be forever examining itself, its institutions, how it does business and its relationships with member states.

This self-examination has led to the creation of a series of key treaties that have resulted in profound changes to the EU and, indirectly, Britain’s relationship with it.

A rundown of the big European treaties and what they’ve meant in practice follows:

• Maastricht (1992): This treaty paved the way for the creation of a single European currency called the euro (see the nearby sidebar ‘One currency to fit all’). In addition, the treaty increased judicial co-operation between states, set out some key social rights for citizens of member states (such as not being forced to work long hours) and got member states to work towards forming a single EU foreign policy rather than each state pursuing its own agenda on the world stage. The Maastricht Treaty was seen as a victory for those who supported the idea of a federal European super-state.

  The negotiations before the signing of the Maastricht Treaty were highly controversial in the UK. The UK government at the time – led by the Conservative prime minister John Major – demanded and won opt-outs from the social rights part of the treaty and the move towards a single European currency. When Tony Blair’s Labour Party swept to power in 1997, it dropped the opt-out on social rights but chose to remain out of the single currency; the UK thus still has its own currency – the pound – whereas most countries in the EU use the euro.

• Amsterdam (1999): This treaty looked to inject a little more democracy into the EU law-making process. The European parliament, with its elected members, gained more rights to approve or block laws drawn up by the European Commission. The terms of this key treaty also guaranteed the free movement of people within the EU.
• Nice (2004): This treaty was all about reforming the institutions of the EU to cope with the ultimate expansion of membership to 27 states. Seats on the Council of Ministers and in the European parliament were redistributed.
• Lisbon (2007): More powers for the European parliament and a tweaking of how voting in the Council of the European Union would work were two of the administration highlights of this treaty. In addition, a charter of fundamental rights – a bit like the Human Rights Act – was made binding on all member states. The treaty also set up the post of a new European Union president, which was first taken up in 2009. This treaty was ratified by all member states in late 2009.

Just because a government signs an EU treaty doesn’t make it law. In most member states the domestic parliament has to ratify – debate and vote upon – the treaty before it’s actually made into law. An EU treaty only comes into law across the EU if every member state ratifies it.

Holding the Purse Strings: EU Budgets

Just as in many a marriage, some of the biggest tear-ups in EU history have boiled down to one subject – money. Under EU rules, each member pays a levy roughly proportionate to the size of its economy and this money is then collected together to pay for the following:

• Bureaucracy – the EU civil service
• MEPs’ pay and expenses
• The Common Agricultural Policy
• Grants to member states to help fund infrastructure projects
• Grants to help areas of member states suffering severe economic deprivation

Arguments arise when member states meet to discuss who should be paying what into the EU. The German government, for example, gets back only half of what it contributes in terms of grants and payments under the Common Agricultural Policy. On the other hand, Poland gets around four euros for each one it contributes to the EU budget. Little Luxembourg does best, though, getting around five times as much as it pays in, and that’s one of the richest countries – measured in euros per head of population – in Europe. Go figure!

The Council of the European Union and the European parliament set the EU’s budget each year. The Council gets to set the budget for the Common Agricultural Policy (explained in the next section). The parliament decides other expenditures, such as grants to member states to improve infrastructure or for job creation schemes in deprived areas. The Council and parliament draw up their budget estimates and the Commission consolidates them into a draft EU budget. Both the Council of the European Union and the parliament can amend it and then both bodies have to approve this final budget.

Accounting for the Common Agricultural Policy

Nearly half of all the money the EU spends goes towards carrying out the Common Agricultural Policy (CAP). To understand why agricultural policy is so important, you have to go back to the aftermath of the Second World War when much of Europe was starving. Many leading politicians in France and Germany decided that making sure that Europe could feed itself in future should be a key objective of the EU. They didn’t care whether the EU achieved this goal through direct aid from the EU or by raising tariffs on imported food. As a result, the CAP was born. This policy guarantees EU farmers a minimum price for their crops, while preserving the rural heritage of the EU.

With the promise of the EU buying their products even if the consumer didn’t want them, EU farmers just produced more and more. In the 1980s the CAP was brought into disrepute when the EU purchased and stockpiled unused foodstuffs – dubbed ‘the butter mountain’ and ‘the wine lake’ by the British press. At the same time, an offshoot of the CAP, called the Common Fisheries Policy, was causing controversy because it was leading to the large-scale decommissioning of fleets in Scotland.

In recent years, though, the CAP has started to change, with farmers in the nations that joined the EU in 2004 benefiting from subsidies and investment to modernise their agriculture. However, among many British politicians CAP is still a byword for waste and protectionism.

Getting a rebate

Compared to the amount of money that member state governments spend each year, the EU is quite frugal. In 2013, for instance, it spent less than 10 per cent of what the UK government spent that year.

Each year the UK gets a rebate on its contributions to the EU because it has a small agricultural sector that receives limited sums from the EU. Yet, as one of the biggest economies in the EU, the UK has to stump up billions of pounds in contributions. The UK’s rebate is a way of trying to redress the balance. Basically, the UK makes its contributions to the EU and then receives money back in the form of aid. At the end of the year the EU works out how much the UK has given and how much the EU has spent on the UK. The UK then receives a rebate based on this difference. The rebate is calculated as approximately two thirds of the amount by which UK payments into the EU exceed EU expenditure returning to the UK. The retention of the rebate has caused several arguments at meetings of heads of state in the past, particularly with the French!