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Introduction

Sceptic quotes

Europe is a cul-de-sac

Forget about Europe - Britain's only real ties are in the special relationship with America

Britain is trapped inside a Fortress Europe

European integration is destroying national identity

Europe is undemocratic. The power lies with unelected, faceless bureaucrats

The EU Budget rips us off - we want our money back (rip-off)

The EU is strangling enterprise with red tape

The EU is riddled with fraud and corruption

Brussels finances propaganda in Britain

The idea of an EU foreign policy is a joke

Europe wants British soldiers to fight under the EU flag (European army)

The Common Agricultural Policy is a scandal - British Fish for the British (farms & fish)

The are to many problems for enlargement to work

The euro is a straitjacket

Emu means a superstate through the backdoor

The euro means higher taxes

Unaccountable bankers in Frankfurt have far too much power

Political union is a one-way street

Europe is fostering a disunited Britain (regionalism)

Europe never plays by the rules: Britain always loses out (fair play)

 

A glossary of eurosceptic beliefs  an exposé of misunderstanding

Source: The European Commission

Representation in the United Kingdom

Introduction

In the run-up to the Single Market, the process of removing internal barriers and setting up EU-wide standards meant a leap in the amount of EU-level legislation. This process had many different impacts – some liberating, some inconvenient, some frustrating, some amusing.

Irritation with some of the effects combined with a general uneasiness towards the European Union in British public opinion to provide fertile soil for what became 'Euroscepticism' – itself a misleading term, since it was often and remains a cover for outright hostility to the EU.

Media sympathy with Euroscepticism had a direct impact on British public opinion, leaving an indelible impression of continental inefficiency, introspection and ham-fisted bureaucracy. In 1994 the European Commission in the UK produced a publication Do you believe all you read in the newspapers?, debunking some of the Euromyths peddled by British newspapers. It contained precise examples of misleading and factually inaccurate stories run by newspapers about Single Market measures. It was very popular, with copies reaching 80 countries worldwide. It was one way of pointing the finger at the lack of professionalism and anti-European bias of much of the British press. This was followed a year later by another publication in the same vein Do you STILL believe all you read in the newspapers? It had even more impact.

This Glossary of Eurosceptic Beliefs brings together many of the favourite Eurosceptic mantras and presents the facts. We hope it will help those who want to know what really lies behind the stories they read, and to measure for themselves the destructive impact of 25 years of Eurosceptic distortion.

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Sceptic quotes

Countdown to disaster
Without some major change of course the British people could, by the time the year ends, be irrevocably committed to living in just a comparatively small part of a vast new state, under a political system as undemocratic as any in the world.
Christopher Booker, Daily Mail

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Will Britain's repeal of the Single European Act lead to a constitutional crisis in its relationship with Europe? The answer is, yes, of course it will. Indeed, that is the intention of repealing the Act. And will that culminate in the UK's departure from the EU, perhaps even its public and humiliating expulsion? The answer then becomes, yes, that may well be the outcome, and Britain must look forward to the day when it can again determine its own destiny and the Westminster Parliament can once more defend the ways of life of its people.
Professor Tim Congdon, Eurofacts

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Hitler boasted that his Reich would last a thousand years. Kohl went even further: E&MU would be for ever. Hitler was wrong, and Kohl will be wrong. But tens of millions of lives will be ruined and perhaps countless numbers lost in Bosnian-style wars before his folly is brought crashing to the ground.
Bernard Connolly, Freedom Today

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How can it now be right for our elected representatives in their own self-interest to break up these United Kingdoms into 12 'mickey mouse' apartheid homelands within a Superstate of Europe.
Greg Lance-Watkins, Save the Pound website

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Never mind the euro, the problem is Europe
You have to remember that the federasts have been at it since the Fifties. The faces may change but the goal remains the same. The endgame is to lock us all in so tightly to a federal Europe that we will have nowhere else to go.
Richard Littlejohn, The Sun

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For to be in the European Union means to cede sovereignty to another, namely, the acolytes of the Papacy who rule the European Union.
Chris Richards, The Reformer

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"Europe is a cul-de-sac"

Eurosceptics like to denigrate Britain's European partners, and the EU as a whole. The reality is that the EU is strong, both economically and politically.

The 1990s saw the transformation of the major EU economies, with low inflation, sound public finances and buoyant trade. Some problems remain, most obviously the scourge of unemployment. But the EU remains one of the most dynamic, productive economic forces in the world. The euro is set to ensure that Europe does not lose out in the race for competitiveness. Governments across the EU are now promoting economic reform at home and EU-wide. A new agenda of developing e-commerce and the information economy is now accepted as the common goal across the EU.

UK businesses know that their competitors in other EU countries are amongst the toughest in the world. It is interesting to note that those in direct contact with other European countries are often less dismissive than those who stay at home.

Attacks on political systems in other EU countries sit oddly with sceptics' beliefs in national diversity. Europe's rich political heritage is founded on a variety of constitutional arrangements. Those who claim that Britain is uniquely democratic feel that the Westminster system is the sole measure of democracy. In fact, membership of the EU is based on liberty, democracy, human rights and the rule of law. The EU would simply not be able to function if countries did not believe that their partners were worthy of respect and trust.

bulletThe GDP per capita of the EU stood at euro 20,100 (£13,960) in 1998 (USA euro 28,900; Japan euro 26,900; Canada euro 17,400; Australia euro 17,300).
bulletThe UK is the 10th richest EU country in terms of GDP per capita (Source: Eurostat -- the UK Treasury has stated that the UK is in 9th, 10th or 11th place, depending on the measure chosen). In absolute terms, current figures put the UK as the second largest EU economy, after Germany.
bulletProductivity in the EU averaged 44,700 in 1996 in terms of ECU per employee (Germany 50,900; Italy 50,300; France 44,900; UK 40,100; Spain 33,300). The figure for the USA was 56,300 and for Japan 58,100.
bulletR&D spending in the EU totalled 135bn ECU (£90bn) in 1997, less than the USA but more than Japan. As a percentage of GDP, the highest R&D spending was in Sweden, Finland, Germany and France (UK in 7th place). The World Economic Forum ranking of innovation in key economies puts several EU countries in the top six: USA; Germany; Finland; the Netherlands; Canada; France.
bulletThe EU had a small trade deficit in 1999 at euro 11bn (£7bn), while the surplus for the countries in EMU was euro 58bn (£36bn). Germany, Ireland and Italy had the highest surpluses; the UK, Spain and Greece were most in deficit. · President Clinton on Europe: "You remain our most valued partner, not just in the cause of democracy and freedom, but also in the economics of trade and investment."

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"Forget about Europe - Britain's only real ties are in the Special Relationship with America"

The idea that Britain faces a choice between EU membership and some special link with the US is wrong. EU membership is unique - no comparable international arrangement exists (or has ever existed). So it is not a question of Britain facing a range of similar options in international relations. Mainstream UK politicians agree that Britain is a European country whose future is inextricably linked to its European partners. Sceptics seem to deny the realities of geography.

There is no conflict between EU membership and close relations with the US - quite the contrary. The EU and the US are each other's most important allies. Britain has particularly strong historic ties to the US, with the common language at the fore. So do other EU countries, most obviously Germany, Greece, Ireland and Italy. The US has consistently welcomed the process of European integration, both before and after the fall of the Berlin Wall.

The EU has a more sophisticated relationship with the US than with any partner outside Europe. This includes joint action ranging from promoting reform in Ukraine to tackling AIDS, from transatlantic town-twinning to combating drugs in the Caribbean. Inevitably, as the two richest economies and the two largest traders in the world, disputes arise. But this should not be allowed to obscure the strength of a relationship based on shared values including trade liberalisation and encouragement for democracy.

bulletThe EU and the US are each other's major commercial partners, with more than euro 450bn (£315bn) of goods and services traded. This trade is remarkably close to balance. Most trade in industrial goods is already tariff-free.
bulletThe New Transatlantic Agenda launched in 1995 is an action-orientated relationship reflecting the breadth of relations - political contact includes twice-yearly meetings between the US President, the holder of the EU Council Presidency, and the President of the European Commission.
bulletAn example of tangible results is the EU-US Mutual Recognition Agreement which came into force in December 1998, which cuts business costs by allowing products to be tested only once for both markets. It covers sectors adding up to trade of some $50bn a year. In this area, the EU's economic links with the US in fact go further than relations under NAFTA.
bulletFamily ties - according to the US State Department, 25% of US citizens can trace family origins in Germany.
bulletEducation - according to the US Department of Education, around 50,000 EU students study in US universities each year (Germany 8,990; UK 7,357; France 5,692; Spain 4,673; Greece 3,010).

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"Britain is trapped inside a Fortress Europe"

The picture of the EU as an inward-looking 'fortress' is wrong. Of course domestic considerations weigh heavily on EU leaders - their electorates rightly expect nothing less. But historic ties, commercial interests and a sense of global responsibility combine to make the EU open and internationalist.

The EU is the world's largest exporter of both goods and services. So fostering protectionism would make no sense. The EU is in the vanguard of global trade liberalisation. It led efforts to spread liberalisation into new areas like IT, telecoms and financial services (where the UK is well placed to benefit). Now the EU has been pushing to bring barriers down further through a broad range of liberalisation in the World Trade Organisation.

The Single Market has not only benefited the EU. It also helps suppliers from outside the EU. Far from facing new barriers, it means they can sell their goods or services under a single set of rules, throughout a market of 374 million consumers. The same effect will follow EMU - all businesses working inside the EU will enjoy the savings and efficiency brought by the euro.

The joint action of national governments and the EU makes Europe the largest donor of overseas aid in the world. It is also promoting new measures to make it easier for developing countries to trade with the EU.

Far from turning their back on a global role, EU countries are working together, convinced that the best way to have an influence is a common approach. From helping the Middle East Peace Process to tackling drugs in the Caribbean to reducing the nuclear threat in Korea, European initiatives now have a global reach.

bulletThe EU is the world's largest trader, accounting for around one-fifth of world trade in goods and around a quarter of world trade in services.
bulletSome 7.5% of EU funds are devoted to development assistance. European aid in 1997 amounted to $71 per EU citizen, compared to $23 per US citizen. In 1993-96, EU countries undertook 74% of all debt forgiveness by OECD members. EU countries also contribute the largest share of IMF funds, almost a third of the total. The EU is also the world's largest donor of humanitarian aid. As for trade, over the last three years, imports from the least-developed countries have risen by some 38%.
bulletAt the time of the Asian financial crisis, there were incorrect claims that the EU was leaving others to shoulder the burden. In fact, at the time, the EU's trade balance with the region fell more than that of the US (euro 33.2bn Jan-Sept 1998) and the EU was second only to Japan in support for IMF recovery programmes.
bulletThe EU uses defensive trade measures like anti-dumping only when threatened by unfair trade. Only 0.3% of EU imports face anti-dumping measures.

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"European integration is destroying national identity"

The idea that there is some hidden agenda to destroy national identity in the EU is one of the most common scare stories peddled by the Eurosceptics. The word 'integration' is seen to imply stamping out diversity and imposing a single way of life across Europe. The decision of EU countries to work together in some areas and to apply a system of law - the Single Market approach - has been used to conjure up a threat which does not exist. The word integration, which means the process of EU countries gradually working more and more closely, has been taken to mean a process of unremitting centralisation, leading to a 'superstate'.

Proud and historic nations in Europe do not feel under threat from working together. Many EU countries are familiar with different levels of government having different powers - and understand that being 'integrated' does not mean having a single source of power. Britain has had a relatively centralised system for centuries, but retains strong identities in Scotland and Wales. The process of devolution is based on the conviction that decentralised power can exist without ending nationhood.

The reality is that the EU applies common rules only where it is necessary. It was necessary while the Single Market was being set up, but in recent years the number of proposals for new laws has tumbled. The need to limit EU-level action to the essentials has now been given force in the principle of 'subsidiarity and proportionality' - jargon perhaps, but jargon which means that there has to be a real justification for action at EU rather than at national, regional or local level.

bulletWim Kok, Prime Minister of the Netherlands: "Our aim is not for each [EU country] to be the same. Nobody is trying to mix the European palette, which is a rich variety of colours, into a uniform dull grey." President Jacques Chirac of France: "The peoples of Europe do not want to merge and to lose their identity … we all need to be under the same roof, but to feel at home and to keep what is familiar to us." Romano Prodi, President of the European Commission: "We are not the US … we are proud to see countries maintain their roots."
bulletArticle 128 of the EU Treaty explicitly protects cultural diversity. EU action like the Raphael programme, to help protect cultural heritage, puts a special emphasis on multilingualism.
bulletWith the end of the Single Market programme, the number of proposals for new legislation fell steadily from around 60 in 1990 to fewer than 10 in 1997 (with total proposals falling from 800 to 500).
bulletSubsidiarity is laid out as a legal requirement in the Treaty: "The Community shall take action … only if and in so far as the objectives of the proposed action cannot be achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community."

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"Europe is undemocratic. The power lies with unelected, faceless bureaucrats."

Democracy in the European Union operates in different ways. The most powerful decision-making body, the Council of Ministers, is responsible through its members to parliaments and electorates in every EU country. Each country decides how to make its ministers accountable.

Direct elections to the European Parliament have created a body with a clear mandate from the electorate. MEPs are accountable for their work on legislation and in scrutinising the other EU institutions.

The unelected European Commission is often cited as the source of a 'democratic deficit' in the EU. However, Commissioners are nominated by elected governments and pass through the scrutiny of the European Parliament. Just as importantly, the Commission's work does not take place in a vacuum. Proposals for legislation result from a long process of consultation with national governments and interest groups. The Commission's management role is exercised with the national governments in hundreds of committees meeting week by week. All its work is subject to scrutiny by the European Parliament and by an independent financial watchdog, the Court of Auditors.

Of course, it goes without saying that the influence that a British voter can have in a Union of 370 million is less than that in a country of 59 million - in the same way that the voice of an individual Birmingham voter counts for more in a local authority with a population of one million than at national level. But by convention and by law, there are many safeguards to ensure that the representatives of every EU country are heard - and the EU always tries to reach a consensus, even when the rules allow decisions by majority rather than by unanimity.

bulletIn 1998 there were more than 3,000 meetings of the Council of Ministers at ministerial or official level - so in any given week there are an average of 60 formal meetings where the 15 EU governments forge policy.
bulletOpportunities for public consultation have grown in recent years. In spite of the reduction in the number of legislative proposals, the number of green and white papers issued by the Commission rose from nine in 1992-93 to 18 in 1996-97.
bulletThe proportion of proposals for new laws coming out of the Commission on the Commission's own initiative is relatively small. It has been calculated that 20% of proposals follow a request from the Council, the Parliament or national governments; 35% are to implement international agreements; 25-30% are to update or modernise rules; and 10% are routine, such as the annual fixing of farm prices. Fewer than 10% of proposals come from the Commission's own initiative.

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"The EU budget rips us off - we want our money back"

The idea that EU membership can be measured purely in balance-sheet terms is a long-standing sceptic belief. The fact that most EU policies - the Single Market, competition policy, common foreign and security policy, trade negotiation, justice cooperation, the euro - have little or nothing to do with the EU Budget is conveniently forgotten. In reality it is impossible to quantify the financial impact of all these policies.

EU Budget revenues come from a variety of sources, including customs duties and a share of VAT revenue, as well as payments based on the wealth of each EU country. EU Budget spending is limited to areas of EU responsibility, with more than 80% devoted to agriculture and regional support. Not surprisingly, these revenues and spending programmes affect different countries in different ways, in the same way that UK taxes and UK spending have a variable impact on different parts of Britain. The effects also vary year by year.

Inevitably, some EU countries find there is a greater proportion of EU revenue collected in their countries than their share of EU spending. This has recently been the case for Germany, France, Italy, the Netherlands, Austria, Sweden and the UK. Partly because the UK is one of the less well-off countries in the EU, a special mechanism was agreed in 1984 to reduce the UK's payments to the Budget.

The EU Budget increased significantly from the mid-1980s, but recent years have seen a ceiling applied to spending, and a decision to hold expenditure broadly stable for the period 2000-06. This has combined with new efforts to ensure better value for money in EU spending, which lies behind policy changes such as CAP reform and institutional changes to improve financial management.

bulletThe EU Budget takes up a small share of EU GNP compared to national public expenditure. A ceiling has been agreed on EU expenditure limiting spending to a maximum of 1.27%, though the 2000-06 Budget agreement will see a fall to 1.13% by 2006 (this figure includes post-enlargement costs). This is a small proportion of the total share of GNP taken by public spending in the EU, which averages 47% (the UK figure is under 40%). The EU Budget in 2000 totals euro 94bn (£57bn).
bulletIn 1997 the share of the EU Budget financed from Britain was the third largest, and the UK received the fifth largest proportion of EU spending. The greatest differences between the share of EU revenues supplied by each Member State and the share of EU spending was : (for net contributors) Germany 15.4%, the Netherlands 3.2%, UK 3%; (for net recipients) Spain 7%, Greece 5.3%, Portugal 3.3%.
bulletThe UK abatement amounts to a two-thirds reduction in the difference between the UK's contribution to VAT-based revenue and the amount of EU spending in the UK. Over the past four years, the UK rebate has been worth between £1.4bn (euro 2bn) and £3.2bn (euro 5.7bn) a year. The Treasury has estimated that over the same period, the total UK contribution has varied between £1.6bn (euro 2.3bn) and £4.6bn (euro 6.8bn).

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"The EU is strangling enterprise with red tape"

The Single Market represents an enormous freeing-up of controls and restrictions. It has brought opportunities for British business to sell goods Europe-wide under a single set of standards, for traders to export goods without costly and time-wasting customs controls, for banks to offer mortgages to clients across Europe.

But every western democracy has rules to protect consumers from being swindled, to protect workers from being exploited, and to prevent cartels. The European market cannot operate without rules. So the EU countries agreed a policy of recognising each other's regulations, and having a minimum set of common rules to ensure fair competition. These minimum standards inevitably involve some give-and-take. Sometimes UK rules have been relaxed to let in new products, sometimes tightened to allow for an EU-wide minimum standard - and sometimes the UK benchmark has become the model for the EU.

Once the avalanche of invented Euromyths so beloved of British sceptics is swept aside, there is a clear rationale for regulation. Regulation balances different interests, such as producers, employees, traders, retailers and consumers. A free-for-all is not the answer.

It is often claimed that the trouble with EU rules is that only the UK tries to apply them effectively. Naturally enough, sceptics in other EU countries make the same claim - that theirs is the only country playing by the rules. In practice, the UK's record is good, but several other EU countries have done even better. And every time a country has been found to be breaking the rules, they have in the end accepted the judgments of the European Court of Justice.

bulletThe benefits of the Single Market include lower prices (e.g. airfares), consumer protection (e.g. toy safety), and the freedom to live, work and study throughout the EU.
bulletIt also means cost savings to make business more competitive. For example, the ending of some 10 million customs forms for UK firms is estimated to have saved UK companies £135m a year.
bulletMany complaints about regulation often prove to be complaints about a liberalisation of the market putting existing practices under threat. Examples are road haulage companies facing EU competitors setting up in the UK, or those suggesting that the 'traditional British toilet' has been 'banned' when consumers were given the choice over which toilet equipment to use. Others are simply invented stories (see website http:/www.cec.org.uk/ ).
bulletThe extent to which EU countries apply Single Market rules is closely monitored. In 1999 transposition of EU Directives into national law ranged from 98.7% in Finland to 94.3% in Portugal, with the UK in 7th place at 96.7%. As for possible infringements of existing rules, in the year to March 1999 there were 334 'letters of formal notice', the first stage in the process, ranging from five Danish cases to 52 French cases, with the UK in joint 8th place with 21 letters issued.

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"The EU is riddled with fraud and corruption"

There have been too many cases of fraud against EU funds. The EU's financial watchdog has estimated that errors in the accounts add up to some 5% of the EU Budget - some of this unfinished paperwork, some accidental miscalculation, but some intentional fraud as well. So although the amount of fraud seems much less than, for example, the level of fraud against the UK social security system, it must be tackled.

More than 80% of EU spending is managed directly by national governments like the UK government. So much of the responsibility for tackling fraud lies at the national level, with governments and law enforcement agencies. Clearer rules and better policing at the EU level help. This was one of the goals in recent changes to policies on agriculture and regional funds. But strong sanctions in national law and firm application of procedures on the ground are critical.

A linked issue is the question of Commission management of funds. Even though the Commission manages less than one-fifth of the EU Budget, it still adds up to a significant sum, and EU taxpayers have every right to expect it to be properly managed.

In January 1999 the Commission and the European Parliament set up a Committee of Independent Experts to look into a number of allegations. The Committee concluded that there had been several instances of mismanagement which had made fraud by outside bodies possible, and that the Commission had not been willing enough to take responsibility. It also criticised three Commissioners for nepotism. As a result, all 20 Commissioners decided to resign.

A new Commission took office in the autumn of 1999 with a strong reform mandate. Reform is focused on management and financial reform with the goal of a Commission meeting the highest standards of public service.

bulletIt is notoriously difficult to give a reliable estimate of fraud. Fraud investigations covering around 1% of EU spending were under way at national or EU level in 1998, with a slightly larger figure for fraud against EU income (e.g. against customs duties). The Benefits Agency estimates that UK social security fraud is around £4.7bn a year, or 5% of total social security spending.
bulletThe Report of the Committee of Independent Experts can be consulted on the website www.europarl.eu.int/experts/ Current reforms to achieve the Commission's goals of efficiency, accountability, service and transparency can be tracked under the Commission website www.europa.eu.int/comm/reform/index_en.htm.

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"Brussels finances propaganda in Britain"

Eurosceptics seem to define any information they do not like as propagandist. So even the most basic factual information prompts this accusation. Their real objection is to the whole concept of the European Union and its institutions. The European Commission is attacked as a way of attacking the EU as a whole.

Every public authority has a responsibility to provide information to the general public about its work. The Commission is no exception. Though the primary duty to explain EU policy lies naturally with national governments, the Commission has its own responsibilities. So when national governments and the European Parliament agree the EU Budget each year, they ask the Commission to help them in the task of keeping the public informed, and set aside funds for that purpose.

Propaganda must, by definition, involve forcing misrepresentations onto an unwilling public. But the Commission provides information on demand only. For example, information for use in schools is only sent to those schools which request it.

The euro presents a special case in the UK. The Commission has a responsibility to uphold the EU Treaty in its entirety - including the right for the UK to make its own mind up about whether to apply to join the euro. So though the Commission has a duty to explain the benefits of EMU for the EU as a whole as laid out in the Treaty, the same duty requires it to uphold the freedom of the UK to determine its own policy on the euro.

bulletInformation work is designed to be "an effective channel of communication and dialogue between the people of the European Union and the Community institutions. [Actions] take account of specific national and regional characteristics, in close cooperation with the Member State authorities." (The EU Budget)
bulletAn information service set up by the UK Government and the European Commission received 11,000 requests for EU information from the education sector during the course of 1999.

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"The idea of an EU foreign policy is a joke"

The EU is not a single government. On some policies, EU countries have decided to pool powers and make laws at the EU level. In other areas - like foreign policy - the EU is more about cooperation than law. The EU's voice is more influential as a bloc than as 15 countries. That is why world leaders from President Clinton to Premier Jiang Zemin to President Mbeki have set up structures to ensure regular meetings with their EU counterparts.

Of course, different EU countries have different historical priorities. So Spain has particular ties with Latin America, Finland with Russia and so on. There are also different foreign policy traditions, most obviously for those Member States which are 'neutral'. But as the process has developed, confidence and coordination have gradually increased.

An EU foreign policy has made a difference. Sometimes this has been down-to-earth, with the EU financing work such as mine clearance in Angola or the international police in Albania, for which no alternative funding was available. The EU has not found a magic solution to the problems in the Western Balkans. But it has helped peace and stabilisation from the Baltic to Central Africa.

The extent of coordination is without precedent. Many times every day, governments across Europe are communicating, both electronically and in person, exchanging opinions, intelligence and proposals. There is now a new system in place to bring these threads together. This will allow the EU to plan its foreign policy more strategically, and to ensure that it is clearly articulated to partners worldwide.

bulletEU countries agreed 163 policy statements in 1998, on issues ranging from the trial of the Lockerbie bomb suspects to the nuclear tests in India and Pakistan.
bulletEU countries pay for 38.7% of UN peacekeeping operations (the USA share is 30.5%). The EU paid for 54% of international support to the Middle East Peace Process in 1993-97, and 73% to Central and Eastern Europe in 1990-97.
bulletThe Common Foreign and Security Policy (CFSP) allows the foreign policy instruments of the 15 Member States to be used to best effect, backed up by the influence gained from the EU's economic weight and able to draw on the EU Budget for development aid and humanitarian assistance. The 15 EU countries now also regularly coordinate with the 13 applicant countries, for example in the United Nations.
bulletA High Representative has now been appointed to coordinate CFSP (Javier Solana, the former Secretary General of NATO).

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"Europe wants british soldiers to fight under the European flag"

Sceptics often attack any decision to pursue cooperation as a threat to national identity. Attempts to achieve common goals by working together are attacked as a threat to the nation. Security and defence cooperation is a good example.

NATO has been the bedrock of European defence since the Second World War. But the security aspirations of EU countries have evolved in the years since the fall of the Berlin wall. It makes sense to try to maximise the ability of Europe to bring its security capability to bear, and this suggests new structures to complement the existing NATO systems. Already EU countries cooperate in terms of logistics, intelligence and development of new weapons systems - as well as deploying troops side by side in areas such as Kosovo. EU countries - led first by Britain and France - are now keen to take this one step further, to help make the Common Foreign and Security Policy more effective by ensuring that EU countries' military capability can work in tandem with foreign policy goals. Such a capability would be used for tasks like peace-making or peace-keeping. This would not be a threat to NATO: NATO itself endorsed this approach in the Washington summit in April 1999.

British and other troops are not being dragooned into some single force to fight under the European flag. Nobody is looking to bring defence arrangements under normal EU decision-making procedures. Nor does it mean that the neutral EU countries will be forced to sign up to NATO-style agreements on collective defence. EU leaders have made clear that the goal is not collective defence. What it means is EU countries again working together in the belief that cooperation is the best way to maximise the effective pursuit of common goals.

bulletAt the Franco-British summit at St Malo in December 1998, the UK and France agreed that the EU needed "the capacity for autonomous action, backed up by credible military forces, the means to decide to use them and a readiness to do so".
bulletNATO's 1999 Washington summit concluded: "NATO embodies the vital partnership between Europe and North America. We welcome the further impetus that has been given to the strengthening of European defence capabilities to enable the European allies to act more effectively together, thus reinforcing the transatlantic partnership."
bulletThe December 1999 Helsinki summit agreed to: "develop an autonomous capacity to take decisions and, where NATO as a whole is not engaged, to launch and conduct EU-led military operations in response to international crises. This process will avoid unnecessary duplication and does not imply the creation of a European army."
bulletThe Helsinki summit also agreed a precise goal - by 2003, the EU should be able to deploy within 60 days and sustain for at least one year military forces of up to 50-60,000.

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"The Common Agricultural Policy is a scandal - British fish for the British"

The Common Agricultural Policy has been one of the most controversial of EU policies. This is not surprising. The CAP is the largest item of EU spending, and worldwide, farming reflects not only a specific economic interest but a special mix of social, cultural and environmental factors. By the same token, there is nothing unusual in governments supporting farming - on the contrary, it is the norm. Part of the original agreement of the Treaty of Rome was to create a single agricultural market, with the costs of subsidy falling at European rather than at national level. Within this market, safe products cannot be excluded - and the EU Court of Justice is there to ensure that EU countries cannot use food safety as an excuse to set up a trade barrier.

The EU farming industry has seen huge changes since the CAP was set up. Recently, EU farm policy has also been shifting, to a greater emphasis on rural development, food safety and quality, and the environment. This shift has not been perhaps as rapid as many would have hoped, but its direction is clear.

The CAP's critics often argue that agriculture and food policy could be 're-nationalised'. This would put at risk the benefits of free trade in food in Europe. At a time when consumers' demands for choice and quality continue to rise, an EU-wide approach is essential to ensure a food industry which balances competitiveness, food safety, good value for consumers, the environment and farm incomes. Retreating into farm protectionism within the EU is not the answer.

Critics of the Common Fisheries Policy often suggest that if EU fishing quotas were set higher, there would magically be more fish in the sea. The opposite is true. Without the CFP to manage fish stocks around Europe, the threat would be that a precious natural resource would be fished to extinction.

bulletEU agricultural spending amounts to around 0.5% of GDP, or some 1% of total EU public spending. This represents a smaller share of GDP than spending by neighbours like Norway and Switzerland. US agricultural subsidy, though less than the EU in total, is in fact larger per farm.
bulletSuccessive agreements have cut the share of EU spending devoted to agriculture from 70% in the mid-1980s to 45% in 2000. The agreement on spending in 2000-06 will see agricultural spending held broadly stable from euro 40.9bn in 2000 to euro 41.7bn in 2006.
bulletThough taxpayers will pay a little more in 2000-06, consumers will win savings from price cuts estimated by the UK Government to be £1bn a year by 2006, or £65 for each household.

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"There are too many problems for enlargement to work"

Criticism of the approach to enlargement comes from two directions. Some argue that the EU has been slow to embrace new members, suggesting that the EU should water down its rules to ease early enlargement. Others suggest that enlargement will mean ballooning costs and a flood of immigration threatening jobs. Both criticisms are wrong.

The European Union is committed to enlargement. It is actively helping all 13 applicants to prepare for accession, more than doubling the funds set aside to help the countries of Central and Eastern Europe modernise their economies and administrations. Over recent years the EU has already mobilised a package for the former Eastern bloc countries comparable to US post-war support under the Marshall Plan. But this does not mean an explosion in costs - it has already been agreed that in spite of enlargement, the EU Budget will remain broadly stable for the period 2000-06. The costs will largely be met from savings in other areas.

But the very reason that so many countries are looking to join the European Union is that it is a dynamic and ambitious organisation - and, by the same token, it is a complex and demanding one. So whilst the EU has an obvious responsibility to help accelerate the readiness of applicants for membership, for countries to join before they are ready would be in the interests neither of the current 15 members nor of the applicants.

bulletThirteen countries are involved in the enlargement process: Bulgaria, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, the Slovak Republic, Slovenia and Turkey.
bulletThe criteria for membership were defined in 1993 (the 'Copenhagen criteria'): democracy, the rule of law, human rights and the protection of minorities; a functioning market economy, and an ability to cope with competitive pressures within the Single Market; and the ability to accept the obligations of membership, including the rules and laws known as the acquis communautaire, a body of law with some 80,000 pages of EU legislation.
bulletFar from grinding to a halt, the process of negotiating accession is steadily progressing day by day. EU leaders have now agreed that negotiations should embrace 12 of the applicants, and that the EU should be ready to commit itself to being ready for enlargement from 2002.

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"The euro is a straitjacket"

The euro's critics believe that a monetary policy set for several EU countries is doomed to failure. But before EMU's participants were chosen, clear criteria were set to ensure that their economic fundamentals were in line. In terms of inflation, interest rates and sound public finances, the euro-zone economies are now in tune to an extent undreamt of ten years ago - and said by the sceptics to be impossible. Of course, this does not mean that the economies are identical or equal, any more than the economies of London and the Scottish Highlands, or California and West Virginia, are the same.

Adopting the euro as a single currency means having a single monetary policy for the whole euro-zone. Inevitably, this means that at some time in some country, monetary policy will not be as closely aligned with national needs as if the policy was set nationally. When countries signed up to the euro, they assessed the economic costs involved against the economic benefits of EMU - macro-economic stability, no exchange-rate costs, and price transparency. They concluded that the benefits outweighed the costs.

Sceptic predictions that EMU will blow asunder have a familiar ring. They predicted that EU countries' economies would never converge. This underestimated the political will across the EU to tackle inflation and to cut budget deficits. The sceptics then predicted that the exchange-rate parities set in May 1998 would be torn apart before EMU's launch at the end of that year. In fact, the foreign-exchange markets showed their confidence in the system by leaving the parities untouched.

bulletWhen the Maastricht Treaty came into force, the 11 countries making up the euro had inflation rates ranging from 1.9% to 6.6%. By 1999 this range had fallen to 0.4%-2.3%, with average inflation in the euro-zone 1%. Public finances had converged from a range of deficit of 9.5% of GDP/surplus of 1.9% of GDP in 1993, to a deficit of 2.9% of GDP/surplus of 2.3% of GDP.
bulletDifferences in wealth between EU countries are often no less than differences between regions within a country. The GDP per capita of the poorest region in the UK is 32% of the richest region (Inner London). The GDP per capita of the poorest country in the euro-zone (Portugal) is 42% of that of the richest country (Luxembourg).
bulletEMU will not have an impact on the size of the EU Budget. Far from pushing up the levels of spending on regional assistance, these are set to fall: the recent agreement on the EU Budget 2000-06 will see spending on structural support falling by 2006 by around a quarter from 1999 levels.

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"EMU means a superstate through the back door"

It is almost a truism that EU policies are political. The extent and the complexity of EU policies goes far beyond a purely economic organisation - and could never have been achieved without a high degree of common political commitment. Economic and monetary union is no different. EMU involves handing over control of monetary policy to common institutions, and accepting each others' scrutiny of relevant national economic policies. This could only be possible in a European Union where countries have political confidence in their partners and can make such arrangements work.

But that does not mean that the motivation for EMU was the creation of some form of superstate. Even if this chimera was a real goal of EU leaders, it would be naïve in the extreme to believe that EU governments would blithely press on towards a philosophical political construct when this was not in their national interests. Every key economic decision on the EU - the customs union, the Single Market, EU backing for free trade through GATT/WTO, and now EMU - has been agreed because EU governments were convinced that these steps were in the interest of the long-term prosperity and competitiveness of their economies.

Setting up a single currency and a common European Central Bank is a significant step. But it is wrong to equate this with a single European state. Sovereign governments have signed a treaty to set up EMU, but they remain sovereign governments. And however significant a step, EMU by no means ends national economic policies. Where to set tax levels and the size of public spending; what to tax; how to manage social security; where to direct public spending - the vast majority of such economic decisions remain a matter for national governments to determine. And it is clear that if governments fail to pursue effective economic policies and face problems like wage inflation or unsustainable pension costs, they will not be bailed out.

bulletThe Stability and Growth Pact exists to ensure that governments do not undermine the financial stability of the euro by running excessive budget deficits. There is an early-warning system to draw attention to the danger of budgets moving towards large deficits, and sanctions for governments running persistent excessive deficits. Sanctions are on a sliding scale of between 0.2% and 0.5% of GDP, depending on the degree to which a 3% deficit reference value has been breached.
bulletJacques Santer, former President of the European Commission: "We must demonstrate that a federal European Central Bank is able to function without a real federal government …. I am sure that it can."

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"The euro means higher taxes"

Sceptics have seized on the idea that EMU will in some way mean higher taxes as an argument against the euro. They hope to harness the unpopularity of high taxes for the sceptic cause. The argument plays on the fact that most EU countries choose to have higher taxes (and higher public spending) than the UK. But most taxes have nothing to do with the EU. The EU is not concerned with taxes like income tax. Although the European Central Bank and the European Commission express frequent opinions on tax - ironically, that healthy economies need low taxes - this is only an opinion. The EU has no authority to impose overall tax policy on national governments.

The areas in which the EU is interested in tax are strictly limited. For decades the EU has required common rules on VAT, to protect the Single Market. But even here, there are strong national differences. The EU is also looking at how tax breaks can be used to distort fair competition in the EU ('unfair tax competition'). Otherwise it would be too easy for countries to use taxes to get round Single Market rules preventing state aids from giving an unfair advantage. It is also reasonable for the EU to look at common approaches to solving problems like tax evasion.

Every discussion on tax is jumped upon by sceptics, eager to promote the idea of an EU push to higher taxes. A good example is corporation tax rates, where some in the EU believe that without a common approach, jobs have been lost as governments have shifted from taxing company profits to taxing jobs. This is a minority view. Most believe that competition can be a useful way to lower the burdens on business and keep the EU globally competitive. Current tax reforms in Germany are an example of this policy in action.

bulletThe average tax burden in the EU was 42% of GDP in 1998, with Ireland, Spain and Greece having the lowest burden, Sweden, Finland and Denmark the highest (the UK figure was 37.9%).
bulletThe percentage of GDP taken in corporation tax averages 3.1%, with Germany and France lower than average, the UK and Italy higher (OECD figures). This is because although the basic tax rate might be higher, there are more exemptions and more tax-deductible items in these countries. Amongst the obstacles to a common EU corporation tax would be a need for changes to the tax base and to accountancy rules.
bulletThe UK Prime Minister Tony Blair and German Chancellor Gerhard Schroeder agreed a common statement on EU tax policy in December 1998, agreeing on action against discriminatory tax rules; that there should not be a unified European system of corporate taxation; that personal income tax was a matter for national governments; and that all action should protect European competitiveness and jobs.

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"Unaccountable bankers in Frankfurt have far too much power"

There is nothing extraordinary about the independence of the European Central Bank. Other central banks such as the Federal Reserve Bank in the United States and the Bundesbank in Germany are independent in law. In recent years this has increasingly been the trend for central banks worldwide. The 1997 decision to give responsibility for fixing interest rates to the Monetary Policy Committee of the Bank of England was a clear step in this direction.

The reason for this trend towards independence is that a country's economy can be best served if monetary policy is fixed with long-term economic interests in mind, rather than the pressures of short-term politics.

Recent years have been littered with examples of pre-election booms to win votes, at the cost of bust and recession in the following years. An independent European Central Bank is designed to insulate the euro-zone from such pressures.

But this does not mean that the Bank operates in a vacuum. As with all public bodies, it is important for the Bank to command public support.

The Bank is therefore accountable - to the European Parliament, and to EU governments through the Finance Ministers. It is also transparent, so as to be understood by the public at large. It may be free to reach its own decisions when it fixes interest rates. But it has to be able to justify and explain these decisions.

bulletThe majority of places on the ECB's Governing Council are made up of the governors of the national central banks from the EU countries taking part in EMU (chosen in accordance with national procedures). The execution of monetary policy (e.g. the issuing of notes and coins) is largely in the hands of the national central banks.
bulletThe ECB's policy of transparency is illustrated in the following ways: appearances of the President before the European Parliament at least four times a year; press conferences following the regular meetings of the Governing Council, as well as ad hoc speeches; a weekly financial statement; a monthly bulletin giving an assessment of the economic situation underlying the ECB's decisions; and a full annual report.
bulletECB President Wim Duisenberg on openness and accountability: "Accountability for policies is the logical complement to independence in a democratic society. The main way to achieve accountability is through being transparent and open. Transparency also enhances the effectiveness of a central bank. The better it is understood, the more successful a central bank is."

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"Political union is a one-way street"

Sceptics often try to represent the complex history of the European Union as a crude attempt to create a 'superstate'. In fact, political union is a process of gradual integration, with the countries taking part in the European Union cooperating on increasingly wide areas of policy in an increasingly varied number of ways.

The decision to develop integration in this way has been taken by the democratically elected leaders of the EU's 15 member countries. These leaders negotiate and agree the Treaties which set up the institutions of the European Union. The Council, with ministers around the table from every EU country, remains the most powerful of the EU institutions. The members of the European Parliament are elected by the voters of the 15. National governments nominate members of the European Commission and the European Central Bank. And, despite the claims of sceptics that the European Court of Justice (ECJ) exists to exploit the power of the law to drive towards a political goal of centralisation, its real task is to ensure that the Treaty signed by the 15 countries is applied fairly and correctly.

The foundation stones of EU economic policy such as the Single Market, EMU, competition rules and a common trade policy must by their very nature be policed and managed at EU level. But it is not the case that decisions are always being dragged to the centre. Recent changes to farm reform and regional spending, for example, mean that more decisions are being taken at the national level, to reflect national diversity.

bulletEurope's leaders do not want a 'superstate'. Romano Prodi, President of the Commission: "Far from advocating a centralising role for 'Brussels', I believe the time has come for some radical decentralisation. It is time to realise that Europe is not just run by European institutions, but by national, regional and local authorities too, and by civil society." (2000)
Former Chancellor Helmut Kohl: "Nobody wants a centralised superstate - it does not exist and it will not exist in the future." (1996)
bulletThe ECJ has shown that it does not always back an increase in the powers of the centre. The ECJ has backed subsidiarity in cases like the B&Q case, which confirmed that national standards were justifiable as long as they were fairly applied. It has also refused to rule on cases it considers a national, not an EU issue (such as when the House of Lords asked the ECJ to rule on Sunday trading).
bulletExamples of where power has been shifted from the centre are in the beef sector, where national governments can allocate funds according to their own priorities; and under Objective 2 of the Structural Funds, where half the resources are now dedicated to national priorities.

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"Europe is fostering a disunited Britain"

One of the most bizarre of Eurosceptic claims is that the EU is undermining the United Kingdom. The suggestion is made that any steps taken towards devolution and the development of English regions must have been 'forced' on the UK by Europe.

It is true that many European countries have a strong tradition of regionalism. Regions such as Catalonia or Bavaria are powerful political forces. But there is no set pattern - no two EU countries are alike. Far from some Brussels-imposed pattern, the different forms of regional and local government across the EU are proof of its vibrant political diversity. Some EU countries are relatively centralised, like Ireland and Portugal; others place regions at the core of their constitutions, like Belgium or Germany. The UK is somewhere in the middle of this spectrum. Like Italy and Spain, it has decided to grant different powers to different regions, with devolution in Scotland to a greater degree than in Wales, and with Regional Development Agencies in the English regions rather than a new layer of government.

The main EU policy directly concerned with regions is the Structural Funds, where resources from the EU Budget are channelled to regions in economic need. Efforts are made to ensure that the regions used for these purposes match the administrative boundaries of regions chosen by each country.

There is also a regional input into EU policy-making through the Committee of the Regions. Local councillors and other elected representatives from the regions have found it increasingly important that their voice is heard to influence key issues such as EU farming or transport policy.

Sceptics have suggested that the decision to hold the 1999 European Parliament elections on regional lists was a 'Brussels diktat'. This is wrong. Indeed, most EU countries have chosen to run the EP elections nationally, not regionally.

bulletThe regional constituencies used for the European parliamentary elections of June 1999 were introduced under the European Parliamentary Elections Act 1999.
bulletFour UK areas - Cornwall and the Isles of Scilly, Merseyside, South Yorkshire and West Wales and the Valleys - will benefit from support under Objective 1 of the Structural Funds in 2000-06, with Northern Ireland and the Highlands and Islands having support gradually phased out. Other areas will benefit from less intensive Objective 2 or Objective 3 support.
bulletThe Committee of the Regions is a consultative and advisory body set up under the Maastricht Treaty. It is not a decision-making or law-making body. It has 222 members including 24 from the UK, all of whom are local councillors at one level or another. National governments propose names to sit on the Committee according to their own procedures.

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"Europe never plays by the rules: Britain always loses out"

Some Eurosceptic claims seem little more than paranoia. The idea that Britain has in some way been trapped inside an EU designed to frustrate British interests is a good example of this. Of course, no country will always get its way all of the time in the EU. Compromise is part and parcel of taking part in international cooperation. When countries have decided to join the EU, they have presumably judged that the overall benefits will outweigh the occasions when they do not get their way. The many countries with applications to join the EU now on the table will have made the same judgment and reached the same conclusion.

The EU's institutions have been set up to ensure that all countries have a fair say in decision-making. A permanent seat at the ministerial table means that every government has its say. In key areas, unanimity is required to reach a decision. The influence of the UK has helped to promote key British priorities in EU policy such as the Single Market, proper environmental standards and the liberalisation of markets for EU products worldwide. The 87 UK MEPs stand up for their constituents' interests. Fairness between the different EU countries is ensured by the European Court of Justice. Any country can take another country to the Court if it feels rules are not being properly implemented. This may take time - but the Court's rulings have always been accepted. Outside Europe, Britain has no such mechanism to protect its interests.

bulletEU institutions are organised so that countries each have a fair say. So in the European Parliament, Germany, with the EU's largest population, has 99 MEPs, the UK, France and Italy 87 MEPs, Spain 64 MEPs, and so on down to Luxembourg with 6 MEPs.
bulletWhen issues are decided by Qualified Majority Voting in the Council of Ministers, France, Germany, Italy and the UK all have 10 votes, Spain 8 votes, and so on down to Luxembourg with 2 votes. One survey concluded that out of 261 votes in the Council, the UK had been outvoted only seven times, less than 3% (this was less often than Denmark, Germany and the Netherlands).
bulletThe European Court of Justice is an unbiased arbiter of European law. Amongst British groups to have benefited from ECJ rulings are auction houses in France, pharmaceutical exporters to Italy, and chewing-gum sellers in Spain.

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