If a Corbyn-led government is bound by the EU's framework, then it will face big obstacles in delivering its socialist policies, argues Tom Gibbs
As we get closer to the vote in Parliament on Theresa May’s Brexit deal, it continues to look more likely that the deal will be voted down, and neither her threats nor the televised debate she’s planning with Corbyn looks like it will change that. The project fear of a no deal Brexit has reached to the depths of Tory MPs, up to 100 of whom have said they will vote against the deal, being told they will lose their Christmas holidays if the deal is voted down.
All of this means that there is a higher probability that Theresa May will be forced out sooner than later, and in the event, a general election could be on the cards. The Labour Party’s policy is to push for a general election and only when that has been exhausted consider a second referendum. But the voices calling for a second referendum within Labour are growing, and it’s now been revealed that 67 Labour MPs publicly back a so-called “People’s Vote”. Even if there is a general election, there will be huge pressure on the Labour leadership to adopt a position of offering a second referendum if they win the election.
Aside from what this will do to Labour’s prospects in a general election, or Corbyn’s leadership of Labour, or even the effect it will have on the growing far right mobilising around a “Brexit betrayal”, what would staying in the EU mean for Labour’s policies when in government?
The game-changing politics of the current left-led Labour Party have received widespread backing from across Britain. It is worth asking how much of their transformative programme, and further left reforms, are possible in the confines of the EU and the economic constraints imposed by it. While it is in the interests of the ruling class to seal a deal that keeps us as close to the EU as possible (or keep us in it altogether), for a left-led government there are some key areas that would need to be addressed when negotiating a deal.
Here are just 5 areas of popular policy set out in the 2017 manifesto that are obstructed by EU legislation:
1Re-nationalisation of public services, i.e. rail, water, mail, energy.
As the EU insists on a competitive tendering process, Labour would be forced to use public money to pit a nationalised company against privately owned providers from across the EU. That is not nationalisation. As has been seen in a number of cases across the EU, where natural monopolies which are under public ownership are opened up to private enterprise, private companies are able to undercut state providers by cost-cutting methods including lowering wages and cutting corners – which would also have a knock-on effect on wider wage levels and would incentivise finding loopholes in health and safety directives. Rail workers in France have been striking against Macron’s plans to do exactly this.
2State intervention in the economy (including the establishment of a National Investment Bank).
As any such state bank would be considered to be competing against already existing private banking operators (who fund PFI initiatives, for example), it would be in breach of Single Market competition rules. Similarly, any attempt to restructure the economy that would involve state aid would be subject to EU competition law. This includes measures to reduce pollution, finance green technology or enforce environmentally friendly practices on private companies.
3Made in Britain.
The EU’s rules on public procurement would mean that Corbyn’s plans to favour British industry for procurement of government-contracted services would be a violation. It would also mean that plans to renationalise privatised areas of the NHS would be subject to competition rules and practically unworkable. The EU’s competition rules also see free provision of services as illegal, so any attempt to bring about free services in currently privatised areas of health care or public transport would not be allowed. An example of this is Ireland ending water charges which the EU had said was illegal.
4A greater role for trade unions.
To give one example, the European Court of Justice has recently sided with employers in court cases involving workers’ right to strike to stop cheaper labour being brought in at their expense. It has deemed such action to be a breach of capital’s right to freedom of establishment. Again in the case of France, the EU has been a driving force behind Macron’s labour reforms and market liberalisation plans, and as such has pushed back against trade unions organising workers against these changes. The EU’s framework would also inhibit a Corbyn government from ensuring union recognition for government contractors.
5Ending the exploitation of migrant labour.
This is a similar point to the fourth point. The Posted Workers Directive has created legal uncertainty regarding whether temporary workers are protected by the laws of their country of origin, or the ones in the country to which they have moved. The ECJ has ruled in favour of employers wanting to pay workers what they would receive in their home country, which can be significantly less, and make living expenses hard to meet. More generally, freedom of movement (and establishment) has been used by unscrupulous employers to keep their costs down, aided and abetted by anti-union rulings, such as those outlined above. A system based on economic need – profit – is no friend of workers.
These points illustrate that if Britain stayed in the EU or was still subject to Single Market rules once it left, it would blow a big hole through Corbyn and McDonnell’s economic policies.
One of the threats used by Theresa May as well as those who want to stop Brexit, is that the UK would be subject to WTO rules, once outside the Single Market. Interestingly, WTO rules are far more relaxed on areas like state aid and would give a Corbyn government a lot more room to set economic policy and an industrial strategy.
It clear that the EU is no friend of working people, and that leaving Fortress Europe gives us much more of a chance to roll out the socialist programme we desperately need. Another referendum must be opposed, and a general election must be pushed for with a clear direction of renegotiating the Brexit deal, if we are going to leave the EU on the terms necessary for a radical change to the way our society is run.