TORIES LIVING IN FANTASYLAND ABOUT EU TREATY

BUDGET CONTROL
Tory myth: “We didn’t sign the treaty because we do not want our tax and spending decisions to be made in Brussels.” (Michael Fallon 10 December 2011, BBC: “Michael Fallon.... said the UK did not want its tax and spending decisions to be made in Brussels”)

Truth: There was never a suggestion that countries outside the Eurozone be forced to follow tax and spending rules set by anyone. The Statement is signed by the Euro heads of state or government, and the provisions for a “fiscal stability union” explicitly apply only in the Euro area. The countries outside the Eurozone that have agreed to sign the treaty will not lose any fiscal policy control as a result of this treaty, and the summit statement commits them only to “indicate the possibility to take part in this process after consulting their Parliaments when appropriate”.


FINANCIAL TRANSACTION TAX
Tory myth: “We didn’t sign the treaty to prevent the other 26 EU countries from imposing a financial transaction tax on Britain” (Daily Telegraph, 9 December 2011, “Tories fear an enhanced euro group could try to impose a financial transactions tax on Britain”)

Truth: The EU summit changed nothing. We have always had a veto on new taxes that would apply in the UK, ever since we joined the European Economic Community nearly 40 years ago. We had a veto on Thursday and we have a veto now.


THE NEW TREATY AND EU INSTITUTIONS
Tory myth: “We didn’t sign the treaty to prevent the new treaty from being justiciable under EU institutions.” (George Osborne’s claim: "We've protected all these industries from the development of eurozone integration spilling over and affecting the non-euro members of the European Union.”)

Truth: Not signing the treaty has made no difference to whether or not the treaty will use EU institutions, and in particular whether the European Court of Justice will have jurisdiction and be able to build case law based on the treaty. Article 273 of the EU Treaty says “The Court of Justice shall have jurisdiction in any dispute between Member States which relates to the subject matter of the Treaties if the dispute is submitted to it under a special agreement between the parties.”


PROTECTING FINANCIAL SERVICES
Tory myth: “We didn’t sign the treaty to protect the City of London from destructive European regulation in the future.” (David Cameron, repeatedly)

Truth: There is not a single reference to financial services in the 16 paragraphs of the Euro heads of state conclusions published on Friday. Irrespective of that, by not signing the treaty, we have failed to secure a single safeguard for UK financial services going forward. We have no assurances about whether financial services will be discussed by the new monthly meetings of the 26 EU countries.


SINGLE MARKET AND MAJORITY VOTING
Tory myth: “We didn’t sign the treaty to protect the City of London against majority voting in the future.”

Truth: Financial services, like all other aspects of the single market (except tax), have always been decided by qualified majority voting. David Cameron’s proposals were not about the future treaty but about undermining the existing treaty: his proposal was to unpick the rules of the single market that have been in place since Margaret Thatcher’s Single European Act was passed 25 years ago.

David Cameron’s vision of the single market is incoherent. The single market is overwhelmingly in our national interest, and – as Lord Cockfield and Margaret Thatcher understood – it requires majority voting among the 27 countries to function properly. If every country could carve out protection for their chosen industry, there would be no common rules across the market in which 60% of our exporters do their business, and the single market would fall apart.